Once a strong grower in the Caribbean, the International Monetary Fund (IMF) has slashed the Bahamas’ 2016 growth forecast by 0.7 percentage points, dropping it to just 1.5 percent. The IMF has also projected Bahamian growth to barely reach one percent in 2015—a steep drop from an earlier estimate of 2.3 percent.
Chancellor Angela Merkel’s popularity wanes, as many Germans grow weary of asylum seekers flowing into the country. The government plans to accept up to one million refugees for the year, and the government has no official cap on the number of people allowed inside. According to the Bertelsmann Foundation, Germany will need 500,000 new arrivals a year until 2050 to counter a plummeting labor pool. Germany’s population will contract 15 percent by the time 2050 arrives, and the workforce will drop 30 percent.
Economists are expecting more home sales and house building in 2016 even as mortgage rates are set to rise. Thanks to improved demand and growing confidence in the economy, economists at Merrill Lynch are projecting housing starts to rise in 2016 and reach their historical average rate “by the end of 2017.”
The World Trade Organization contains 162 member states and has existed for 20 years. While it is certainly not the oldest trade organization in existence, many have begun to question its viability in the modern age.
The most recent doubts come in the wake of a number of unpopular decisions that appear as anachronisms to some analysts. One example lies in the recent decision against the United States’ practice of allowing companies selling canned tuna to identify, voluntarily, if they used dolphin-safe fishing practices.
Around 90 people lost their lives over the weekend as instability across the East African nation worsens over time, according to AFP. The government justifies the murders, but witnesses speak of workers burying bodies in mass graves, fueling the allegations of a cover-up, and more people could have been murdered. The country returned to a sense of normalcy as of Sunday, but security forces remain present. The U.S. State Department urges Americans to leave Burundi as soon as possible.
In an effort to combat sluggish growth and a collapsing stock market, the Chinese government will turn to merger and acquisition activity next year.
That represents the assessment of analysts at Standard Chartered, a London-based bank that has a substantial presence in Hong Kong. The Standard Chartered report noted that most of the activity will revolve around commodity firms, and will involve state-owned enterprises (SOEs) that have already begun to privatize through equity offerings in recent years.
Former Finance Minister Alexei Kudrin warns that Russia needs to implement structural reforms to save the economy, according to CNBC. He suggests such measures as infrastructure spending, pension reform and decentralization of the budget as useful alternatives that could lead to growth. Kudrin also expressed concern that politicians refuse to take such drastic steps as 2018 elections draw near. The oil market dropped to its lowest price since 2009 this week.
The International Monetary Fund (IMF) flexed its considerable economic muscle this week to force a resolution in ongoing disputes between the Ukraine and Russia simply by changing its lending policies. Per the IMF, Ukraine will have to negotiate in “good faith” with Russia to resolve a dispute over a $3 billion bond due this month. Otherwise, the IMF will not allow a loan from the International Monetary Fund to the Ukraine.
After recent confidence on the labor market from the Federal Reserve and Department of Labor, new data shows unemployment may have started an upswing.
The Department of Labor reported that weekly initial unemployment claims rose to 282,000 in the week ending December 5, an increase of 4.4 percent from the previous week. That drove the four-week moving average for initial unemployment claims above 270,000, above expectations from most economists.
Governor Alejandro Garcia Padilla begged the U.S. congress to pass a law allowing the territory to file bankruptcy, according to AFP. Puerto Rico owes more than $70 billion to creditors, and the governor maintains that bankruptcy will prove necessary to restructure bonds and avert political instability.
The governor urges Congress to permit the Caribbean island to file bankruptcy by the end of December, but President Obama and members of Congress remain resistant to the idea. The government concedes that Puerto Rico is in for another lost decade if the status quo continues.
