globalEDGE Blog

Africa is currently a point of interest for many companies. This continent offers opportunities for rapid growth for both newly formed companies and already mature businesses that are looking to expand. However, starting operations in Africa comes with its share of risks. With an unproven economy, one needs to do research to make sure all facts are collected before breaking ground. Part of BBC's African Dream series is an interview with self-made African billionaire Mike Mlombwa. In the interview, Mlombwa provides tips for growing a successful business in Africa and dealing with red tape.

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Several new economic developments have occurred in the United States during this last quarter. The recent drop in gas prices, credited to the drop in global oil prices led by OPEC, is one of these noteworthy developments. This has led to increased spending in the U.S, especially in the retail and automotive industries. There have also been significant increases in employment, as well as a strengthening in the value of the dollar. While these all seem like boons to the United States, some of these factors have the potential to not only hurt the U.S. economy, but economies around the world as well. As a result, economists are warning the U.S. to take caution, especially with its fragile economy now leaving the period of quantitative easing by the Federal Reserve.

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As Africa becomes more integrated into global value chains, existing trade agreements are not enough to fulfill the increasing foreign investments because they are complex and obscure. With the hope of creating easier access to global market for local businesses, the three largest trade groups in Africa came up with the idea of the “African Free Trade Zone,” which aims to create a single trade union in Africa. The idea has been evaluated  since 2008 and finally it will be realized later this month.

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File under: Germany, Economy, Immigration

In a world where overpopulation and high unemployment are serious problems for many nations, Germany faces an entirely different set of challenges. Germany currently has record low unemployment rates that are leading to a deficit of workers, especially those with high levels of education. To further magnify this issue, the current workforce is aging rapidly, and with the lowest birthrates in Europe, the size of the German workforce will decrease substantially in the coming decades. The most recent projections show that Germany’s working-age population will decrease by 6.3 million people by 2030, and that the entire population could decrease as much as 19%, to about 66 million people.

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File under: Technology, E-Commerce, Labor

Last year on the eve of Cyber Monday, Amazon’s founder and CEO Jeff Bezos revealed the company’s plan to develop drones that would deliver packages to a customer’s doorstep. News of these drones spread quickly, and as a result Amazon broke its Cyber Monday record with a figure of about 426 items ordered per second. By utilizing the advertisement practice of embargoing, or holding the news about these drones until the ideal moment, Amazon was able to maximize its profit and increase sales just in time for the holiday shopping season.

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Many people have heard about or remember the great “Space Race” between the United States and the Soviet Union from 1955 to 1972. Both countries fought for supremacy in spaceflight capability for national security measures and as a sign of ideological superiority. New technology resulted from this space exploration age including satellites, micro-technology, and other products that were later sold and commercialized to be used in everyday life. Education in mathematics, engineering, and science rapidly expanded during this period. Times are rather different now as many governments, such as the United States, are cutting space exploration budgets in light of economic hardships. The Economist has even claimed that the current state of the world marks “the end of the Space Age.”

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File under: Economics, Economy

The OECD has found a link between a country's inequality and the decrease in percentage points of GDP Growth. This decline has been seen in countries including the US, who has lost almost seven points, and the UK, who has lost around 9 points of GDP Growth percentage. This is a shocking point which shows countries that if they want to promote strong and sustained growth, addressing inequality needs to be a central focus.

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Now that a year has passed since former Ukrainian president Viktor Yanukovych refused to sign Ukraine's EU Association Agreement, which began the protests in Maidan Square in Ukraine, the dust from the conflict is beginning to settle allowing speculation regarding the outlook of the nation's rebuilding economy. Now that current President Petro Poroshenko has signed the agreement, many economists are pointing towards rapid growth in the country's tech sector as a sign that clear skies are ahead for the European-aligned new Ukraine. In spite of this, crippling corruption and a brain drain are also casting doubts over Ukraine's foreseeable future.

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Hosted by Dr. Tomas Hult from Michigan State University’s International Business Center, the globalEDGE Business Beat (gBB) is your source for global business knowledge on the airways. The gBB offers discussions with global leaders in business, government, and academe and is available on the globalEDGE website and the Michigan Business Network.

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File under: Economics, Russia, Oil

As discussed in an earlier blog post, oil prices are continuing to fall as global demand weakens, affecting economies around the globe, such as the United States, Norway, and Saudi Arabia. One of the countries most affected is Russia, which heavily depends on the oil industry, so much so that it makes up an estimated 60% of the country’s exports. The Russian government began the year expecting oil prices to be near $96 a barrel, and with current oil prices well below this number, there is reason to worry about Russia’s economy.

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