globalEDGE Blog - Page 134

It is no surprise that education is one of the biggest determining factors of an economy’s success and growth, which is why in fall of 2015, some 20.2 million students were expected to attend an American college or university. Since 2009, there has been an increase of over 4.9 million college attendees. However, education is not nearly as accessible in other parts of the world as it is in the United States, and it is restricting potential growth.

A new study conducted by the international law firm Denton in association with the Mining and Investment in Latin America 2015 conference found that many companies, despite current conditions, have remained optimistic. The survey, which was carried out among mining companies and financiers who are active in Mexico, Central and South America indicated that 66% of those interviewed are somewhat optimistic that there will be an increase in investment over the next 12 month. The mining industry is facing challenges with current economic conditions and rout in the commodity markets, but corporate social responsibility was not regarded to be that high of a concern. Corporate social responsibility is important because due to issues, projects worth billions of dollars have been stalled.

China's recent economic activity has set the entire world on edge. In 2015, the country reported a growth rate of 6.9%, its lowest in a quarter century. This has been reflected in the state of the country's major industries, especially in automotives and mining. China is still one of the world's superior mining nations, but several problems have erupted as growth continues to slip. Natural resources are depleting, top minerals and metals are experiencing production decline, and international projects are being abandoned. This has affected the industry on an global scale, considering many countries trading in metals are largely dependent on China. The country appears to hold on to its number one spot with further projects and investments, perhaps in the hopes the industry will give it a much-needed boost.

The United Kingdom is slated to have a referendum by the end of 2017 on whether it is to remain a member of the European Union or leave, however negotiations are underway by the Conservative government to see if a new agreement can be reached. The United Kingdom can risk facing major repercussions both domestically and internationally if they were to leave. Internally, it can raise the risk of political instability both within the Conservative party and the viability of the political union between England and Scotland, Wales, and Northern Ireland, and externally, the concern lies in the future relationship between the U.K. and the European Union as well as potential future trading agreements.

Swiss financial affairs have long been a thing of mystery and wonder. Aside from the general disdain expressed by foreign governments toward Switzerland’s public and private banking institutions, the Swiss franc is not a coin that lends itself to be easily shortchanged. Swiss bank accounts have had fame and notoriety in the past for stark confidentiality agreements as well as attractive investment management options which allowed for a growing number of Swiss bank accounts to be opened by the likes of white collar criminals. And that’s exactly where the misconception is - Swiss bank accounts aren’t popular because of anonymity, they’re in demand because of the unparalleled financial security. One of the biggest reasons these bank accounts are able to thrive so well in such an isolated economy is because the Swiss franc has been a fierce champion for growth and stability. These financial tenets are more easily boasted than achieved, but against all odds the Swiss currency has provided a fiscal anchor in the sea of global economic uncertainty.

“We are the basket which holds all the proverbial eggs.” This quote by the Zambian Chamber of Mines President about their national mining industry can be extrapolated to more widely represent the economy of Africa. Many African nations are heavily reliant, if not entirely dependent, on the mining industry to drive economic growth. However, due to a multitude of causes, the once booming mining industry that once drove national annual growth rates into double digits is now faltering and bringing the rest of the economy down with it.

It is no secret that the mining and metals industry is mired in a multi-year slump. Unfortunately, it looks as if this trend will continue into the foreseeable future. One major reason for this negative outlook is slowing economic growth in emerging markets, particularly in China. This issue has proven problematic for the industry, as it has caused investors and lenders to flee the sector, which has in turn created a shortage of financing. However, there is cause for optimism, as most industry experts ensure that the painful cycle will eventually come to an end.

On Tuesday, The U.S. House of Representatives voted almost unanimously to pass legislation that would broaden sanctions on North Korea. This bill comes after North Korea announced last Wednesday that they had successfully completed a hydrogen bomb nuclear test. The bill proposes stronger sanctions that would deny North Korea the money that it needs for developing nuclear warheads, long-range missiles, and for paying its army and police forces. It will also use financial and economic pressure to keep North Korea away from maintaining the assets that they hold in foreign banks.

Manila is a relatively short plane ride from Singapore, but a world apart. In Singapore, as I reported last week, the ASEAN Economic Community (AEC) is the topic of the minute (even if some officials admit it’s “a lot of hope and not a whole lot of change, yet.”) In the Philippines, on the other hand, one high ranking government official estimated awareness of ASEAN at about seven percent in the general population and roughly 30 percent among businesses. He could not site any numbers for the AEC specifically.

Throughout human history, natural resources have been the bedrock of human development and commerce. In ancient times, civilizations flourished based on vast amounts of precious minerals or other valuable resources. Is it possible, however, that in modern times an abundance of natural resources can be as much a curse as a blessing to a nation state? This is not a brand new thesis, in fact many have covered it from academia to national publications and everything in between.