As 2016 draws to a close, a sense of unease is gripping many commentators as they look ahead. This year brought victories for Brexit and Donald Trump. The outcome of both votes were largely unexpected. What will 2017 bring? The EU is facing three, or even four, elections in major member states. The Netherlands, France, Germany and possibly also Italy will go to the polls. The outcome in all four elections is far from certain at this stage. Indeed, voting behavior seems to have become difficult to predict.
Economic and sociological research points to a number of different factors provoking these recent results. The debate is broadly about whether it is economic issues such as income inequality, cultural issues such as a rejection of equal rights for women, minorities and gay people, or factors relating to citizens’ perceived loss of control over their destiny that has driven people to support populist candidates and causes.
At first sight, the economic factors seem to have played a strong role. The vote for Brexit predominantly came from the countryside, where GDP per capita levels are significantly lower than in the cities. Moreover, income inequality levels are much higher in the United States and the U.K. than in continental Europe. And indeed, one can show that the Brexit vote is significantly affected by regional income inequality though the effect may not be very large.
The second explanation is a rejection of progressive cultural norms. An interesting study by Ingelhart and Norris emphasizes very much this aspect. They offer evidence that the recent protest votes are a cultural backlash against progressive values. And indeed, discourse especially on social media has totally changed. Unfortunately, it seems to have become widely acceptable to talk of white supremacy and engage in racist discourse.
China and Switzerland on Saturday signed a free trade agreement (FTA) — Beijing’s first in continental Europe — in a deal that comes against a backdrop of trade tensions between the Asian giant and the European Union (EU).
Chinese Commerce Minister Gao Hucheng and Swiss Economy Minister Johann Schneider-Ammann inked the accord in a ceremony at the Commerce Ministry in Beijing before officials and reporters.
Afterwards, they clinked glasses of champagne in celebration of the agreement, which aims to increase the $26.3 billion in bilateral trade they recorded in 2012.
China in April signed its first FTA with a European country — non-EU member Iceland — but Saturday’s deal marks the first with an economy in mainland Europe.
Switzerland ranked as the world’s 19th-largest economy in 2012, according to the World Bank. China is the world’s second-biggest.
“This free trade agreement has an important significance for the relationship between the two countries,” Schneider-Ammann told AFP after Saturday’s signing ceremony.
He noted that China is the world’s single biggest developing market with potential for a growing middle-class. Read More
Mario Draghi, president of the European Central Bank, tackled the political debate surrounding Britain’s EU membership on Thursday night, telling a City of London audience that Europe needed “a more European UK”.
Mr Draghi’s comments in a speech at the City of London Corporation, reflect unease in continental Europe about the damaging effects to the bloc that might arise from a British exit from the EU.
“I cannot say which of the two sets of arguments is stronger, the economic or the political ones, neither am I going to enter into a domestic policy debate, but what I can say is that Europe needs a more European UK as much as the UK needs a more British Europe,” Mr Draghi said. Read More
Barclays’ chief executive Antony Jenkins has told investors that cost reduction is his absolute priority and he wants to find a way for the bank to operate with as few as 100,000 staff – a near 30 per cent reduction on its current headcount.
Mr Jenkins said a bank’s “only competitive advantage is going to be lower costs”, according to one person present at a recent shareholder meeting. “He said the only question is: ‘how can you eventually turn this bank into one that can operate with 100,000 staff instead of 140,000?’”
The revelation will fuel speculation that Barclays is preparing a round of mass job cuts – potentially targeting highly paid investment bankers. However, people familiar with Mr Jenkins’ thinking said the reference to job reductions was not a target but an aspiration for the next 10 years. Read More