It is no surprise that the German economy has been instrumental in balancing the struggling Eurozone. France, along with Germany, are the Eurozone’s brightest economies and are leading the way towards a much needed economic recovery. Germany has been able to weather the strained economy and has held its own during the recession with positive growth projections. However, the woes of the Eurozone countries, along with foreign factors, are beginning to wear on the German economy and are causing more setbacks than before. A survey taken by the German Ministry of Economics shows that Germany's manufacturing activity has shrunk for the first time in fifteen months, an example of how the stalling Eurozone economy is affecting Germany.
globalEDGE Blog - Page 167
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Export growth in the global economy is stagnant. China’s exports increased by 8.6% last year, yet for a decade it had produced export growth rates around 20%. Similarly, Germany’s export growth has slowed significantly, increasing by only 0.9% in 2013. Sluggish trade is a result of a slow global economic recovery that has consistently failed to meet target projections. Financial officials in some countries are contemplating currency devaluation as a measure to make exports more appealing abroad.
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According to a draft of a communique that the International Monetary Fund (IMF) and World Bank Development Committee plan to release on October 11, finance and development officials are warning of major current downside risks to the global economy. The major risks that are cited include potential deflation in Europe, Japanese recession, and a slowing Chinese economy.
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Michigan’s economy is reinforced by the global export market, with food and agriculture exports creating a $3.2 billion industry and supporting over 20,000 jobs. Exports of consumer food products are growing three times faster than sales in the United States due to foreign consumers’ growing purchasing power and lower trade barriers. Exporting is an essential way for Michigan companies to increase sales and profits by tapping into a far greater consumer market.
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Tensions across Europe are escalating as a potential energy crisis is looming in the near future. In June of this year, Russia cut off all gas supplies to Ukraine, citing Ukraine's failure to payback debt. Ukraine has since been receiving gas from Hungary, Poland, and Slovakia. Hungary, however, suspended the flow of natural gas to Ukraine last Friday, intensifying the energy crisis in Ukraine. Ukraine is dependent on natural gas to heat homes and to power industry during the rapidly approaching winter months.
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Last week, Prime Minister Mariano Rajoy visited Beijing, China to help gain economic support for Spain. Rajoy met with the President Xi Jinping and Premier Li Keqiang to help facilitate the signing of 14 contracts, totaling about 3 billion euros ($3.8 billion). A crowd of Spanish and Chinese businesspeople were in attendance as Rajoy encouraged China to invest in Spain after its recovery from the Eurozone crisis.
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Oregon-based High Impact Technology (HIT) is a company that specializes in making “smart” materials that are designed to seal up after being punctured. More than half of the company’s employees work on the international part of the business and exports are essential to HIT’s success. High Impact Technology’s products primarily have military purposes and its customers include Germany, Canada, and Russia. A recent blog post by the International Trade Administration (ITA) documents a discussion about HIT’s international business opportunities between HIT’s Director of Operations Russ Monk and ITA Senior International Trade Specialist Doug Barry.
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Africa’s second biggest economy is experiencing an energy shortage that is affecting consumers and businesses across the country. Eskom, the state-owned electrical provider, has informed customers that the company cannot keep up with the increasing demand for electricity, and has asked everyone to reduce the amount of energy they use. Recently, these measures have not been enough, forcing Eskom to implement managed electrical blackouts, impacting the 95% of South Africans that rely on Eskom’s service.
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A large number of new startup companies are appearing in Israel. What is making Israel such a sought after destination for these new enterprises? Part of it could be that the government is introducing new programs that encourage innovation in the country. The online edition of Entrepreneur magazine published a story highlighting the many reasons why Israel is a hotspot for current entrepreneurs.
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Argentina has been facing many economic and financial troubles these past few months. Future predictions are now showing a poor outlook for its economy, as the country is struggling with high inflation, a major decline in the value of the peso against the U.S. dollar, and more trouble involving disputes with hedge fund and holdout creditors. For a country that has had a history of economic troubles in this century, none of these things spell anything good for Argentina's future, and it only seems to be getting worse from here.