President Barack Obama’s recent visit to India will kick-start stalled negotiations on a bilateral investment treaty (BIT) between the US and India that has been under sporadic discussion since 2008, aimed at facilitating greater cross-border investment flows.
The US employment report was nothing shy of spectacular. Job growth was better than anticipated. Back months had higher revisions. Earnings growth recouped the December fluke. The participation rate jumped. It is true that the unemployment rate and the underemployed edged higher. Yet, on balance, those who doubted a mid-year Fed hike have to reconsider.
Vietnam has recently upped its diplomatic efforts to strengthen relations with major powers by signing comprehensive and strategic partnership agreements. The underlying diplomatic philosophy is to create interdependent relations with as many major powers as possible, while avoiding taking sides. And whether or not the benefits outweigh the costs, Vietnam is unlikely to change course any time soon.
Few countries have done so well out of China’s belated economic awakening as Australia, which has sated much of the People’s Republic’s voracious appetite for overseas iron ore and metallurgical coal. Supply struggled to keep pace with demand and the prices of the raw materials for Chinese growth shot up: this translated into an eye watering increase in the Australian terms of trade. This has undeniably contributed strongly to the sunny economic conditions that have prevailed in Australia for much of the past decade.
The main story today is not that the ECB will no longer (as of February 11) accept Greek government bonds as collateral and that Greek banks can have access to the national central bank via the Emergency Lending Assistance. That news broke late in North America yesterday. The euro fell around a cent on the news. The real development today is that the impact remains largely confined to Greece. As this became clear, and that the ECB would lift the ELA borrowing cap by 10 bln euros, the single currency recovered in the European morning.
Two things stand out about the economic recovery in Britain. One is the sluggish growth in real wages. The other is the sluggish growth in productivity.
That the two phenomena have coincided is no accident. Low real wages, by eroding the incentive to work and the morale of workers, have fed low productivity. At least we can cling to the thought that the solution to this might offer a genuine recovery with sturdy roots.
The Planning Commission is dead: long live the National Institution for Transforming India (NITI).
The role and remit of India’s new planning institution has been under debate ever since Prime Minister Narendra Modi in his Independence Day address announced the demise of the Planning Commission. In the Cabinet Resolution passed on 7 January, the government has announced the broad contours of the NITI, whose role in India’s policymaking ecosystem will be different to that of the Planning Commission.
For years, Chinese officials and foreign analysts have been obsessed with China’s GDP growth figures. There has been a widespread belief that if GDP growth dips below 8 percent, there would be massive upheaval. This widely held perception turned out to be nonsense.
The end of 2014 saw the Philippines submit its weakest economic report in almost three years. Moves to curb graft are part of the reason behind this negative data. The abuse of power throughout the government has deterred public spending. Despite the positive things he has been able to achieve so far, President Benigno Aquino has to convince officials throughout the country to unclog the logjam.
Indonesia’s ‘oil bonanza’ is now over. It ceased to be a net oil exporter and became a net importer in 2004. Indonesia currently produces only slightly above 800,000 barrels per day while the consumption level is about 1.4 million barrels per day. This leaves about 600,000 barrels for net import. In the golden era of oil in the 1980s and 1990s, Indonesia produced 1.6 billion barrels per day while total consumption was about 800,000 barrels per day.
