Standards that is. The Chinese domestic appliance manufacturer Haier just got voted into the number one slot by FT readers in a survey which included quality, trustworthiness, innovation and management, together with branding. Haier recently hit the headlines when it unsuccessfully tried to buy Maytag – owner of the Hoover brand – now it looks like it may not have been worth the effort. Long live learning by doing.
Category Archives: A Few Euros More
How Quickly We Forget
Coincidences never cease to surprise me. Last Friday I mentioned the work of Brookings analyst Fiona Hill on Afoe. Well today she writes in the FT (with Sara Mendelson) alerting us to the continuing problems of the North Caucasus and our continuing neglect (subscription only unfortunately).
This week, the one-year anniversary of the hostage siege and massacre of children and parents in the Beslan school gym is tinged with a specific sorrow; it could happen again. The political situation in Russia?s North Caucasus region is dangerously unstable but few outside the region are paying attention.
Beslan was an especially depraved example of what has spread well beyond Chechnya. Acts of intra-communal violence, brutal assassinations, explosions and armed clashes are the norm in places such as Dagestan and Ingushetia. Local politics is circumscribed by corruption, incompetence and a lack of interest in the wellbeing of ordinary people. Many regional leaders are running their fiefdoms into the ground. While some in the Russian government claim that the situation has ?normalised? (the Putin administration plans ?parliamentary elections? in Chechnya this November), a recently leaked document from the Kremlin?s own representative to the North Caucasus asserts that the situation is perilous.
Getting Too Much Of A Good Thing
China is getting worried about the impact of the internet on one of its national passtimes:
China on Tuesday introduced an ?anti-online game addiction system? intended to protect players from the mental and physical perils of spending too much time in front of computers.
The system, which will encourage players to play less by cutting the benefits they gain in online games, is to be implemented by local internet companies that have signed a code of conduct drawn up by China’s press and publications administration.
Optimism On The German Economy
Both New Economist and MacroBlog seem very upbeat about the prospects for the German economy. Macroblog cites Bloomberg and says “Things are definitely looking up“. New Economist is rather more guarded, pointing to the IMF forecast, and the recent Federal Statistics Office announcement that second quarter growth came in at 0%. But New Economist find faith in an (old) Economist view that things are getting better in Germany’s surprising economy (ask Doug on the main page about the surprising bit 🙂 ). As New Economist says “Of course the Economist can get it wrong, but in thbis case maybe they’re onto something”, while as Edward replies “of course the IMF can get it wrong, but in this case maybe they’re onto something”
The Financial Times definitely comes down on the side of the optimism camp, but in their case with significant prudence:
However, fears Germany?s election system might result in a fractious ?grand coalition? between the CDU and Social Democrats may have damped expectations more recently and economists remain cautious about the strength of any German upswing. Holger Schmieding, economist at Bank of America, warned that expectations were fickle and that ?the economic upswings heralded by major surges in the ZEW in mid-2002 and early 2004 both turned out to be disappointingly shallow and short-lived?.
As for me, well, for my part
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France’s Trade Deficit On The Rise
France has just clocked up a record trade deficit for the first six months of this year: 11.193 billion euros. This now adds the French to the eurozone BoP sick room along with Italy, Spain, Greece and Portugal. Of course oil imports form an important part of the picture, but that doesn’t make the headache any less.
The shortfall in June widened to 1.194 billion euros from 1.148 billion in May. The deficit for the first half of 2004 had been limited to 581 million euros.
The finance ministry said that at prices prevailing at the beginning of August France could face an energy sector deficit of more than 40 billion euros this year after 29 billion in 2004.
“The increased impact of the energy component has accounted for nearly half the deterioration in the overall trade balance for France” in the past year, the ministry said, citing rising oil prices.
Alexandre Bourgeois, an economist at Natexis Banques Populaires, said the trade deficit of the last 12 months — 20.6 billion euros — was the highest in French history.
UK Economy Slowing
The UK economy showed its weakest year-on-year performance for 12 years during the second quarter of this year, and manufacturing seemed to enter recession. Gross domestic product (GDP) growth on a 12-month comparison stood at 1.7 percent during the second quarter — the weakest 12-month performance since the first quarter of 1993.
The annual growth rate dropped from 2.1 per cent to 1.7 per cent, which marks the lowest rate of growth since the first quarter of 1993 and almost half of the 3.2 per cent growth rate achieved only in 2004.
Output by manufacturing companies declined 0.7 per cent after a fall of 0.9 per cent in the first quarter, confirming that the sector had dropped into a technical recession, which is defined as two consecutive quarters of falling output.
China Imports To EU Continue Their Rise
The latest EU25 trade data from Eurostat highlight the competitive challenge some European companies face from the fast-growing Chinese economy:
Imports from China in the first four months of this year, at ?45.3bn ($54.5bn, ?31.5bn), were 19 per cent higher than the same period a year before. Imports from the US remained almost flat at ?52.6bn. In contrast, EU exports to China fell by 1 per cent to ?15.2bn, while exports to the US rose by 2 per cent…..
China?s economic expansion suggests the rate of growth of exports to the EU is likely to be maintained. By the end of this year, imports from China could be almost three times higher than the level in 1999. That increases the pressure on domestic producers, as well as eurozone exporters.
Financial Times
EU25 trade was characterised by an increase in the EU25 surplus with the USA (+24.2 bn euro in January-April 2005 compared with +23.0 bn in Januar y-April 2004 ) and Switzerland (+ 6.0 bn compared with +3.8 bn). The EU25 trade deficit grew with China (-30.1 bn compared with -22.8 bn), Russia (-16.3 bn compared with -11.5 bn) and Norway (-10.0 bn compared with -8.0 bn), and fell with Japan (-9.9 bn compared with -11.5 bn).
Concerning the total trade of Member States, the largest surplus was observed in Germany (+ 55.0 bn euro in January-April 2005 ), followed by the Netherlands (+ 11.8 bn), Ireland (+ 10.8 bn) and Sweden (+ 5.8 bn) . The
United Kingdom (-30.7 bn) registered the largest deficit, followed by Spain (-22.6 bn) , Greece (-10.4 bn) and France (-9.9 bn).
Source: Eurostat
Italy Stuck In The Doldrums
The economic news from Italy continues to be grim. This week more negative data on consumer confidence and the trade deficit (the biggest since 1992, and it was of course in 1992 that Italy came flying out of EMU).
The ISAE research institute’s consumer confidence index fell to 100.9 in July from 102.9 in June, touching its lowest level in 13 months and underlying the public’s reluctance to make expensive purchases of property or durable goods.
Earlier this week Italy reported it had run a world trade deficit in the first five months of this year of ?6.28bn (?4.4bn, $7.6bn), the biggest imbalance between national exports and imports since 1992.
Battle Royal In Portugal
Obviously, convincing people of hari-kiri type economic policies simply to maintain the SGP (I say ‘simply’, but I imagine you understand what I mean) was never going to be easy for a growth strapped Portugal. Well, the finance minister has just resigned citing ?personal and family reasons? as well as fatigue.
“A new Portuguese finance minister was hurriedly sworn in yesterday as the Socialist government sought to reassure financial markets that the surprise resignation of his predecessor would not weaken efforts to cut the biggest budget deficit in the European Union.
Lu?s Campos e Cunha, the architect of a programme of tough measures to cut public spending, quit unexpectedly late Wednesday only four months after the centre-left government took office…..
But his decision to quit came amid a clash within the government and the Socialist Party over a plan to invest billion of euros in a new Lisbon airport, high-speed rail services and other infrastructures.
Running It All Away
This story today is worth a quick glance:
Mark McGowan went into the tiny backroom kitchen of a south London gallery three weeks ago and flipped on the cold water. He didn’t turn it off, and doesn’t plan to for an entire year.
“The Running Tap,” as it’s called, is McGowan’s effort to protest against wasted water in London by blatantly letting it go down the drain.