Category Archives: Global economy

Asian manufacturing boom offers hope for swifter global recovery from Covid

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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.

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Things are looking up for oil, but Opec can’t uncross its fingers just yet

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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.

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Taiwan politicians throw pig guts at each other in row over US meat imports

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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.

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Stock market rally pushes Dow Jones to record high of 30,000

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  • Dow rallies by 450 points to close above 30,000 for first time
  • Investors cheer hopes of vaccine and smooth Biden transition

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.

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US and Taiwan sign five-year agreement on health, tech and security

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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.

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World poverty rising as rich nations call in debt amid Covid, warns Gordon Brown

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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.

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US blocking selection of Ngozi Okonjo-Iweala to be next head of WTO

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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.

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Big tech accused of avoiding $2.8bn in tax to poorest countries

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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.

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EU seeks Amazon protections pledge from Bolsonaro in push to ratify trade deal

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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.

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IMF estimates global Covid cost at $28tn in lost output

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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.

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Creditors must wake up fast to threat of emerging market debt crisis

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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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World Bank announces $12bn plan for poor countries to buy Covid vaccines

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Initiative aims to ensure low-income countries are not frozen out by rich nations

The World Bank has announced plans for a $12bn (£9.3bn) initiative that will allow poor countries to purchase Covid-19 vaccines to treat up to 2 billion people as soon as effective drugs become available.

In an attempt to ensure that low-income countries are not frozen out by wealthy nations, the organisation is asking its key rich-nation shareholders to back a scheme that will disburse cash over the next 12 to 18 months.

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Trump attacks WTO after it says US tariffs on China broke global trade rules

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President says he has to ‘do something’ about the body after it rules that duties on $200bn worth of Chinese goods breached regulations

The United States has described the World Trade Organization as “completely inadequate” after it criticised the Trump administration’s tariffs on China.

The WTO said on Tuesday that the US breached global trading rules by imposing levies on more than $200bn of Chinese goods in the opening salvo of president Donald Trump’s trade war with Beijing two years ago.

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World Bank calls for greater debt relief for poorer countries in wake of Covid-19

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President David Maplass says inequality has worsened as depression looms over poorer nations

The head of the World Bank has called for a more ambitious debt relief plan for poor countries after warning that the Covid-19 recession is turning into a depression in the most challenged parts of the globe.

In an interview with the Guardian, David Malpass raised the prospect of the first systematic write-off of debts since the 2005 Gleneagles agreement as he said fresh Bank figures due out next month would show an extra 100 million people had been pushed into poverty by the crisis.

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Debt in developing countries has doubled in less than a decade

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Jubilee Debt Campaign reveals sharp rise in number of countries in distress since 2018

Developing nation debt has more than doubled in the past decade and left more than 50 countries facing a repayment crisis, according to a campaign group.

Data from the Jubilee Debt Campaign shows that even without taking full account of the impact of the coronavirus pandemic, there has been a sharp jump in the number of poor countries in debt distress since 2018.

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China retail sales fall fuels concern for global recovery from Covid-19

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Retail sales dropped 1.1% in July while industrial production remains subdued

Fears over the strength of China’s economic recovery from the coronavirus pandemic have been raised after retail sales slumped in July and industrial production remained subdued.

Fuelling concerns for the world economy, retail sales in China dropped in July by 1.1% compared with the same month a year ago, missing predictions for a small increase in consumer spending.

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Stock markets boom as hopes rise for US economic stimulus and Covid-19 vaccine

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S&P edges towards all-time record with oil prices and hospitality stocks rising as investor optimism rebounds

US stock markets moved closer to record highs on Tuesday after investors bet on a fresh round of government spending to lift the economy and counter the effects of the Covid-19 pandemic.

The S&P 500, seen as the broadest measure of US investor sentiment, raced to a 10-point gain by mid afternoon to leave it just 16 points short of the all-time high reached in February.

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UK to plunge into deepest slump on record with worst GDP drop of G7

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Official measure to be declared this week as coronavirus lockdown shrinks GDP by 21% in second quarter

Britain’s economy will be officially declared in recession this week for the first time since the 2008 financial crisis, as the coronavirus outbreak plunges the country into the deepest slump on record.

Figures from the Office for National Statistics on Wednesday are expected to show that gross domestic product (GDP), the broadest measure of economic prosperity, fell in the three months to June by 21%.

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Shell reports $18bn loss as global oil and gas prices collapse

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Energy giant hit by massive change in fortunes as Covid-19 crisis forces writedown in asset values

Royal Dutch Shell has reported a deep financial loss after a record writedown on the value of its oil and gas assets due to the collapse in global market prices triggered by coronavirus.

The Anglo-Dutch oil giant revealed a net loss of $18.3bn (£14.1bn) for the second quarter 2020, down sharply from a net profit of $3bn over the same period last year and $2.7bn in the first three months of 2020.

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Super-rich call for higher taxes on wealthy to pay for Covid-19 recovery

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Exclusive: Group of 83 wealthy individuals demands ‘immediate, substantial and permanent’ higher taxes ‘on people like us’

A group of 83 of the world’s richest people have called on governments to permanently increase taxes on them and other members of the wealthy elite to help pay for the economic recovery from the Covid-19 crisis.

The super-rich members, including Ben and Jerry’s ice cream co-founder Jerry Greenfield and Disney heir Abigail Disney, called on “our governments to raise taxes on people like us. Immediately. Substantially. Permanently”.

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