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Economy & Trade

At EU summit Czechs and UK Directly Refuse in Joining Fiscal Compact

Tuesday, 31 January 2012 00:00
Written by Navid Iqbal
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Czech Republic along with United Kingdom refused in signing up. United Kingdom Prime Minister named David Cameron told his government could work if the contract threatened the UK interests. He has the "legal concerns" on use of the EU institution in enforcing fiscal treaty and it was mentioned by him. The Czechs again mentioned "constitutional reasons" just for the refusal of them, President of France named Nicolas Sarkozy told. The Czech President, a Eurosceptic, named Vaclav Klaus might be very much reluctant to be involved in signing the treaty, the analysts tell.  The aim is very much nearer co-ordination of the budget policy from corner to corner of the EU for preventing excessive debt accumulating.

The largest lender of eurozone is Germany and it has the most dominant economy - was mainly enthusiastic to have a great binding treaty which will actually be adopted for enforcing the budget rules. That treaty would empower “European Court of Justice” for monitoring compliance as well as impose the fines on the rule-breakers.  That contract spells out also the improved role of European Commission for scrutinizing the national budgets. The British PM David Cameron said "We will not be ratifying this treaty and it places no obligation on the UK"

Czech Republic also is not in the eurozone, but just like other fresh EU member state it is actually committed to bonding. The leaders of European Union discussed also ways of stimulating the economic growth inspite of the severe austerity budget in most of the countries - as well as focused on exactly how to lessen the unemployment rate all the eurozone. United Kingdom as well as Denmark is only two states with the explicit opt-out from the eurozone.

Mr Cameron again told “it's good that the new treaty is absolutely explicit and clear that it cannot encroach on the competences of the EU". He also added "They must not take measures that in any way undermine the EU single market," he said, adding: "we'll be watching like a hawk". Mr. Cameron gave importance on that the contract could impose such "no obligations on the UK". He utilized his veto at last month for opting out of treaty, in conflicting that the United Kingdom needed to carry on its authority over financial service in London.  Actually the eurozone catastrophe dominated the summit of Monday, with the debt-laden country Greece still remains at the risk of evasion.

 

 

Economists Opine Recession Returning Europe

Friday, 30 December 2011 18:07
Written by Navid Iqbal
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Government strictness has destabilized growth and then caused a big deal of the anger around the Europe.  The great majority of the leading economists who has polled by BBC now believe that the recession will dramatically return to the Europe in the year after the end of this year. One fifth of the economists confidently said that the eurozone could not survive in its existing seventeen member form, when the greater portion put the opportunity of the break-up of eurozone at the probable range of percentage like 30% to 40%.

Also the poll found that many of the economists look forward to the United Kingdom’s interest rate to stay at the percentage of 0.5% right through next year. This was conducted in the midst of 34 economists of United Kingdom and Europe who frequently give advice the well-known Bank of England. Among the 27 economists who then responded, 25 at that time forecast the recession for the Europe just right in the next year. Growth in the Europe has dramatically slowed in the current months since eurozone debt catastrophe has strictly forced the governments to lead in spending as well as has undermined self-assurance in the global monetary markets.

Eurozone economy had grew by the approximate percentage of 0.2 between the months of July and September, when the twenty seven economies of European Union raised collectively by the 0.3 percent. Politicians have already attempted for resolving the catastrophe, together with the contract to falsify closer ties among the European members, but the markets yet have to be influenced the actions they have already taken are enough. If the debts catastrophe rumbles on longer than as usual, then Europe will obviously return to the recession. Most of the economists of this world are starting to believe this now.

The usual growth in the United Kingdom during the 3rd quarter was at the 0.6 percent. On the other hand, the growth in those previous 3 months was completely flat. However, the group of CBI recently said that the year of 2012 might be the commencement of the more flourishing future if “pain" of the deficit lessening passed very much quickly. In the message of the upcoming New Year, the John Cridland of CBI said that the eurozone disaster posed such type of "significant threat" straightforwardly to British economy, for the reason that 40 percent of United Kingdom exports were hugely sold there.

 

 

Solid Start for 2011 for American Auto Industry

Friday, 11 February 2011 18:10
Written by Julius
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Even with high unemployment all over the country, consumers visited auto retailers and bought with them new cars and trucks. This led to increased sales of cars and light trucks to an estimated 819,895 for the month of January, which registers a 17% jump over the same month from 2010. Analysts believe that the sales are driven by the vehicle owners’ needs to replace their old machines. While there was an improvement as well as signs of better consumer confidence, the sales figure is still way below the one million vehicles sold in January of 2008.

While the nation’s economy showed improvement, the figure clearly shows that the auto industry as a whole is still in a fragile state. Even so, most of the well established car companies reported double-digit boosts in their sales for the month. GM (General Motors) reported that car sales to individuals (who contributed to the strong January sales a lot) jumped by 36%. Consumers flocked to the shops to buy new vehicles and among the models that sold well were the Ford Explorer (among SUVs/sports utility vehicles) and the Honda Fit (among small cars) to name a few.

At this stage, analysts believe that the auto industry as a whole can sell about 13 million vehicles by the end of the year and that January’s sales are a good indication. Skeptics however think that the high unemployment and high price of gasoline will however weaken sales in the months to come and prevent the industry from reaching the 13 million mark.

Long-Term Unemployment Rate Remains High

Friday, 28 January 2011 09:25
Written by Julius
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With the nation still reeling from the continuing effects of the recent global recession, the long-term employment rate among Americans still remains obstinately high.

According to a Pew Charitable Trusts study released on Thursday, January 27, the unemployed 30% of the 14 million Americans have bee suffering unemployment for more than a year already. This is a huge increase of 25% over the last year. When translated to estimated figures, this means that 4.2 million Americans, or roughly the total population of Kentucky, do not have jobs for a long time now. Among these unemployed workers, over 40% are aged 55 and above.

And even if there is a long-term unemployed rate decrease of 200,000 in December 2010 from August 2010, the good news offered little relief. Also, the situation could be worsened by the decline in the amount of federal money spent on unemployment insurance benefits, according to the Congressional Budget Office's data. Spending on short-term and long-term unemployment benefits will decrease by $30 billion from fiscal year 2010, to only $129 billion in fiscal year 2011.

The decline was caused by denial of the benefits to Americans who have been unemployed for more than 99 weeks, and by the expiration of a stipulation in the Recovery Act that provides a $25 weekly supplement benefit.

According to an analysis of federal records by CNN, unemployed people have claimed up to $319 billion in unemployment insurance benefits over the past three years, which is when the Great Recession has sent the global economy paralyzed and reeling.

Export Slowdown May Cause Higher Prices, Shortages, Delays

Tuesday, 11 January 2011 07:14
Written by Julius
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America's huge and tension-filled trade deficit with China could be eased and limited if inflation slows down the latter's mighty exporting machine. Trade deficit, or the negative balance of a trade in which the amount of a country's export is less than its imports, was the one of the underlying tensions during US President Barack Obama and Chinese President Hu Jintao's recent talks in the Washington.

Because of inflation, Western multinational companies are now cutting back on importation of products from the big manufacturer China, and consumers are balking at the higher prices of merchandise. Some of these companies have even canceled their shipping of raw materials across the Pacific.

There were markups of 20 to 50 percent on products across the range of industries, for example in clothing and shoes, that sent these Western multinational companies scrambling for alternative suppliers. Though there are available alternative suppliers, like Vietnam, India and other Southeast Asian countries, none could match China's manufacturing power and refuge from high global commodity prices.

The American shoppers would reel from limitations in trade deficit. In effect, the slowdown in export would expect higher prices or even temporary shortages of products in the coming months, according to manufacturers and distributors. They also say that delays on purchases are also expected, because most probably retailers would haggle over commodity prices.

Such delays and shortages could be prevented if Western buyers would renew contracts at a much higher cost. However, this implies that American shoppers should first accept and purchase the products, even at higher prices.

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