International Monetary Fund says there are concerns about share price bubble
Governments and central banks must maintain their pandemic rescue programmes or risk triggering a stock market crash, the International Monetary Fund has said.
Warning that there were legitimate concerns about a share price bubble, the Washington-based organisation said that without continued low interest rates and government subsidies it was possible a “correction” in stock markets would occur.
Continue reading...Philipp Wilhelm knows local people rely on forum’s revenue – but still thinks world must change
In his youth, Philipp Wilhelm was at the forefront of protests against the World Economic Forum’s annual “extreme capitalism” gathering of the business and political elite in Davos, the Swiss mountain resort where he grew up.
Now, however, Wilhelm is the mayor of the town and his central mission is to ensure the return of the WEF jamboree, which had been scheduled to start next week but was cancelled this year due to the pandemic.
Continue reading...For an emirate dependent on trade, transport and tourism, vaccination, not lockdown, is key to keeping its economy going
As if the Boohoo online fashion company had not generated enough controversy in recent months, its bosses once again found themselves in the headlines last week for hosting a four-day meeting with suppliers in the luxurious surroundings of a Dubai hotel.
The company’s top executives had taken a private jet to the emirate for the get-together with the businessmen and women who supply their fabrics and manufacture their fashions, despite Foreign Office guidance that advises against all but essential travel.
Continue reading...Despite Covid, global stocks started 2021 on a high. But some analysts warn of an ‘epic’ bubble, amid fears that the flow of stimulus has created a monster
Insurrections are not usually seen by investors as buy signals. Yet even as rioters stormed the seat of US legislative government last week, stock market indices hit new highs in New York, adding another chapter to 12 months of apparent defiance of economic gravity.
Wall Street, measured by the benchmark S&P 500, was not alone in starting 2021 with a bang. London’s FTSE 100 jumped by more than 6% in the first week of the year as investors took in a heady cocktail of a President Joe Biden ready and able to spend money, cheap borrowing costs, and the hopes that vaccines will end the coronavirus lockdowns. Yet amid the exuberance a serious concern looms: are we on the cusp of another colossal crash?
Continue reading...Donald Trump’s departure will alter the face of geopolitics. The climate crisis and Covid response will affect all nations – while others face very particular challenges. Observer correspondents examine the 12 months ahead
A potent mix of hope and fear accompanies the start of 2021 in most of the world. Scientists have created several vaccines for a disease that didn’t even have a name this time last year. But many countries, including the UK and the US, are still stumbling through the deadliest period of the pandemic.
The shadow of Covid will not begin to lift, even in richer countries, for months. Britain was the first to approve a vaccine and has secured extensive supplies, yet Boris Johnson’s suggestion that life might be returning to normal by Easter is widely seen as optimistic. Other countries, particularly in the south, face a long wait to get vaccines, and help paying for them. The rebuilding of economies shattered by Covid everywhere will be slow; even countries that managed to contain it have taken a hit, from Vietnam to New Zealand.
Continue reading...Centre for Economics and Business Research says it expects this to happen half a decade sooner than it forecast a year ago
China will overtake the US as the world’s biggest economy before the end of the decade after outperforming its rival during the global Covid-19 pandemic, according to a report.
The Centre for Economics and Business Research said that it nowexpected the value of China’s economy when measured in dollars to exceed that of the US by 2028, half a decade sooner than it expected a year ago.
Continue reading...Talks on reducing charges on items such as Scotch whisky follow UK move to drop levy on Boeing
The UK and the United States are hoping to reach an agreement on reducing trade tariffs, according to Robert Lighthizer, the US trade representative in Donald Trump’s outgoing administration.
In an interview with the BBC, Lighthizer said he was in talks with the UK’s international trade secretary, Liz Truss, which could remove hefty tariffs imposed by the US on goods including Scotch whisky.
Continue reading...Millions forced to do without or pay for services as funding fails to adequately shore up healthcare systems, report finds
Millions of people in low-income countries have been forced to go without healthcare or have had to pay for it during the coronavirus pandemic, despite billions of pounds in emergency World Bank funding, research has found.
The World Bank’s $6bn (£4.45bn) emergency health fund to 71 countries in response to Covid-19 failed to strengthen health systems or remove financial barriers to using them, according to an Oxfam report published on Friday.
Continue reading...William Evanina speaks of Beijing’s influence campaign ‘on steroids’, as Congress passes bill targeting big companies such as Alibaba
A counterintelligence chief in the US has warned that Chinese agents are already targeting the personnel of President-elect Joe Biden, as well as those close to his team, as Congress unveiled more measures targeting big Chinese companies.
William Evanina, from the office of the US Director of National Intelligence, told the Aspen Institute Cyber Summit on Wednesday it was an influence campaign “on steroids”.
Continue reading...Markets respond as manufacturing in China and South Korea grows at fastest pace in a decade
Hopes that the world will bounce back from the ravages of coronavirus in the new year have been buoyed by strong growth in output from Asia’s huge manufacturing centres, led by an accelerating post-pandemic boom in China.
China’s factory activity expanded at the fastest pace in a decade in November, a closely watched survey showed on Tuesday, in the latest sign that the world’s second-largest economy is recovering to pre-pandemic levels.
Continue reading...Despite good vaccine news and price rises, the cartel could still meet a few bumps in the road – some of them of its own making
When oil ministers from the world’s largest fossil-fuel nations meet via webcam this week to make decisions about the global oil market in 2021, they could be forgiven for indulging in a little early festive cheer.
Oil prices have more than doubled since tumbling below $20 a barrel and hitting 21-year lows during “black April” – when Covid restrictions brought major economies to their knees, and caused what is thought to have been the worst month in the history of the oil industry.
Continue reading...Opposition party’s ‘disgusting’ offal protest prompts scuffle in Taipei legislative yuan
Parliamentarians in Taiwan have thrown pig guts at each other before coming to blows over plans to allow US meat imports.
Members of the opposition Chinese nationalist party (KMT) brought the offal to the legislative yuan on Friday in the latest of daily protests during parliamentary sittings.
Continue reading...The Dow Jones Industrial Average has topped the 30,000 mark for the first time as financial markets around the world rally amid hopes for a coronavirus vaccine and smooth transition to a Joe Biden presidency.
The landmark for the Wall Street market comes as investors bet rapid medical advances will bring the Covid outbreak to an earlier end than feared, paving the way for a swift economic rebound next year as business activity returns closer to normal and tough government restrictions are relaxed.
Continue reading...Countries emphasise potential for cooperation and future partnerships, which Beijing opposes
Taiwan and the United States have held their first high-level meetings under a new economic dialogue, inking a five-year agreement and pledging future cooperation on health, tech, and security.
The talks, held amid a contentious US presidential transition period and high regional tensions with China, did not advance Taiwan’s hopes for a trade deal with US, despite the two countries growing closer under Donald Trump and his pushback on Beijing.
Continue reading...Child mortality crisis is looming as nations struggle to make payments to west and China, says former prime minister
It is being called the “great reversal”. After decades of progress, the international goal of eradicating extreme poverty by 2030 is in jeopardy, Gordon Brown has warned, as developing countries battling the coronavirus sacrifice their health and education systems to pay western and Chinese creditors.
“We need a comprehensive new plan that recognises the need for some countries to restructure and reduce debt,” Brown told the Observer. Ahead of a key G20 meeting next weekend, the former prime minister is calling for a global solution if an imminent child mortality crisis is to be averted.
Continue reading...Sources say it is unclear if move is attempt to sabotage trade body much criticised by Trump
The US is blocking the appointment of Ngozi Okonjo-Iweala as the next head of the World Trade Organisation despite the former Nigerian finance minister winning the overwhelming backing of the WTO’s 164 members, it has emerged.
Ngozi had moved a step closer to becoming the first woman and the first African to be director of the global trade watchdog after securing the support of a key group of trade ambassadors in Geneva. Soundings taken by a selection panel of three WTO trade ministers found Okonjo-Iweala had far more support than her South Korean rival, Yoo Myung-hee.
Continue reading...Reform of international corporate taxation could transform health and education, says report
Big US technology companies are exploiting loopholes in global tax rules to avoid paying as much as $2.8bn (£2.1bn) tax a year in developing countries, according to research by the anti-poverty charity ActionAid International.
Facebook, Google and Microsoft have been accused of failing to pay a fair amount of taxes in poor countries where governments are struggling to provide even basic healthcare or education to their citizens.
Continue reading...Brazilian president’s stance on deforestation remains stumbling block for South America agreement
Brussels is in talks with Brazil’s far-right nationalist president, Jair Bolsonaro, over commitments on the future of the Amazon as it seeks to persuade Emmanuel Macron and other EU leaders and parliaments to ratify the trade deal the bloc has negotiated with South America.
The ratification of the draft trade agreement between the EU and the “Mercosur” or Southern Common Market free-trade zone – which spans Brazil, Uruguay, Paraguay and Argentina – has been in doubt almost since it was announced last June.
Continue reading...World economic outlook says 2020 impact is less than thought but there will be deep scars
The International Monetary Fund has scaled back its estimate of the hit to the global economy from Covid-19 this year but warned that the final bill for the pandemic would total $28tn (£21.5tn) in lost output.
Gita Gopinath, the IMF’s economic counsellor, described coronavirus as the worst crisis since the Great Depression, and said the pandemic would leave deep and enduring scars caused by job losses, weaker investment and children being deprived of education.
Continue reading...Zambia could become the first country to default on its debts amid the fallout from Covid-19, but it won’t be the last
Zambia is running out of money to pay its debts. It has asked bondholders for breathing space so that it can put a restructuring plan in place. The copper-rich African state is at risk of being the first country to default on its debts since the start of the coronavirus pandemic.
Not the last though. Zambia is the canary in the coalmine, a harbinger of a full-blown crisis that has been lurking in the background from the moment the seriousness of Covid-19 became apparent.
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