globalEDGE Blog - Page 128

Since the BRICs acronym was first developed in 2001, the BRICS have been a symbol for economic growth and an increasingly global economy. Until recently, the five BRICS countries all enjoyed above average growth rates, and were seen as the leading emerging economies in the world. The acronym originally referred to four countries, Brazil, Russia, India, and China, until 2010, when South Africa was added to complete the acronym. Recently, the BRICS have seen their high growth rates decrease, and in Russia and Brazil, historic recessions are crippling their economies. Through these uneasy times, the BRICS development bank hopes to renew some growth in the slumping economies.

“Fintech” has been used lately as a catch-all for the development of new technologies that have challenged and changed the more traditional aspects of finance, such as wealth management, lending, insurance, and payments. A current key challenge that the financial technology industry is facing is if the industry can continue to grow while facing increasing amounts of financial regulation.

In a statement recently released by the Angolan Finance Ministry, the government stated that it would begin working with the International Monetary Fund (IMF) to help restore the economy after recent difficulties due to the major decline in oil prices. Specific discussions are expected to begin next week during the IMF and World Bank spring meetings in Washington. Angola’s economy relies heavily on oil, which accounts for more than 95% of the country’s export earnings and two-thirds of government revenue. As a result of crude oil prices currently being valued at less than half of the level it reached in mid-2014, Angola and other oil-dominating countries, such as Nigeria, Egypt, and Libya, are struggling to stay afloat economically.

Christine Lagarde, the head of the International Monetary Fund (IMF), gave a speech concerning the global economy last Tuesday in Frankfurt, Germany. The speech covered several facets of international business and economics, including free trade, political risks to worldwide economies, income inequality, and recent policy actions. Above all, Lagarde emphasized the overall state of the global economy, claiming that the current pace of economic recovery and growth is much too slow. Lagarde warned that unless more is done to kickstart economic growth, the global economy will fall behind. Her speech precedes, and perhaps sets the tone for, the IMF and World Bank spring meetings, set to take place in Washington D.C.

Have you visited the globalEDGE Business Beat page lately? The latest segments feature conversations with members of the international business community, including professors and professionals from the private sector. Visit the globalEDGE Business Beat page today to learn more about global security and anti-counterfeiting, micro-entrepreneurs’ involvement in the sharing economy, and the role of Indian academics in the global marketplace. 

Named after the town in Luxembourg where the agreement was signed, the Schengen Agreement allows for the dissolution of internal borders and implementation of passport-free movement within its member nations. After taking effect in 1995, the Schengen Area is currently comprised of 26 European nations of which 22 are also members of the European Union. The four non-EU members are Iceland, Norway, Switzerland, and Liechtenstein, while the only six EU members outside the Schengen zone are Bulgaria, Croatia, Cyprus, Ireland, Romania, and the United Kingdom. Since its implementation, the Schengen agreement has eased the flow of both goods and services across the area providing a major economic benefit to member economies with people making 1.3 billion crossings of the European Union’s internal borders annually, along with the crossing of 57 million trucks carrying approximately $3.7 trillion of goods. Naturally, this opening of borders has been instrumental in the growth of many industries across the Schengen zone, specifically tourism and transportation. However, after the recent terrorist attacks in France and Belgium, the Schengen Agreement, and all its associated economic benefits, could be in jeopardy.

On Sunday April 3, documents from a Panama-based firm, Mossack Fonseca, were leaked in what is being called the biggest leak of confidential information ever. The leak amounts to approximately 11.5 million documents or 2.6 terabytes’ worth of data. The leaked documents reveal corruption and shady business dealings of politicians, world leaders, and celebrities. The leak exposes how major banks, law firms, and asset management companies manage the wealth of the world’s most powerful people.

Whether it is an expansion of one company, the merging of multiple, or simply a business deal, international business is an art often underestimated or taken for granted altogether. The opportunities offered by the expansion of markets is unattainable when confined to one area and can offer tremendous rewards if executed properly. Most businesses, however, are unaware of what really sets international business apart from operating locally. Following are observations by a seasoned participant in the teaching, researching, and consulting of international business as well as supporting statistics.

The globalEDGE team has added a new market to the Economic Classification section. The mature markets section is brand new and highlights the world's most developed countries, based on the Russell Index Global Guidebook Country Classifications. A statistics section provides data on 17 different fields for each of the mature market countries, allowing users to compare countries with one another along with a market average. There is also a risk comparator tab that allows users to compare credit risk and economic risk among mature market countries. A resource segment is provided to offer access to outside mature and developed market resources. Make sure to check out the mature markets section today, along with the emerging and frontier markets sections under globalEDGE’s economic classification section.

As early as last year, Japan’s Prime Minister Shinzo Abe announced that the country could expect a rate hike in consumer tax rates. Last year, it was slated to take effect beginning 2017, but the agenda has since then been moved up quite a bit. Economists are predicting the economic plan may take place as early as late 2016 or very early 2017, as opposed to the previously believed mid to late 2017 timeline. Japan is required first and foremost to think about its own economy and whether or not its consumers could handle another rate hike, but other global factors have become more pressing since Abe’s initial announcement in 2015.