Asia will need $26 trillion of infrastructure investment in the 15 years from 2016 to 2030, said a report published on Tuesday by the Asian Development Bank.
According to the report, titled Meeting Asia’s Infrastructure Needs, the region needs electricity supply chains to deliver power to the 400 million people who still live without electricity.
Infrastructure investment in Asia currently meets only about half the demand. Aid from development agencies, such as the ADB, remains a mere 2.5% of total investment. The report calls on regional economies to provide financing through fiscal measures and to make use of private-sector money.
The report covered 45 countries and territories including China and India. To sustain the current level of economic growth, Asia needs $26 trillion over the 15-year period.
In the previous report, released in 2009, the ADB estimated that Asia would need $8 trillion of infrastructure investment between 2010 and 2020.
In many other countries, excluding the United States, corrupt bankers are often brought to task by their respective governments. The most recent example of a corrupt banker being held accountable comes out of Spain, in which the former head of the International Monetary Fund (IMF), Rodrigo Rato was sentenced to four years and six months behind bars.
According to the AFP, Spain’s National Court, which deals with corruption and financial crime cases, said he had been found guilty of embezzlement when he headed up Caja Madrid and Bankia, at a time when both groups were having difficulties.
Rato, who is tied to a slew of other allegations was convicted and sentenced for misusing €12m between 2003 and 2012 — sometimes splashing out at the height of Spain’s economic crisis, according to the AFP.
The cross-border movement of goods, services, and capital increased markedly for the thirty years up to the Great Financial Crisis. Although the recovery has given way to a new economic expansion in the major economies, global trade and capital flows remain well below pre-crisis levels. It gives a sense globalization is ending.
The election of Donald Trump as the 45th US President has underscored these fears. His first few weeks in office clearly mark a new era not just for America, but given its central role in late-20th-century globalization, for the world as well. Trump is a bit of a Rorschach test. He did not win a plurality, let alone a majority of the popular vote, but that does not stop pundits from claiming that Trump won because of this or that issue.
There are some campaign promises which Trump has backed away such as citing China as a currency manipulator on his first day as President or pursuing legal charges against Hillary Clinton. His priorities have been repealing the national health insurance, formally withdrawing from the Trans-Pacific Partnership, and signaled an intention to re-open the North American Free Trade Agreement.
Trump and his closest advisers seem intent to unwind not just his predecessor’s initiatives, but the general thrust of America’s grand strategy since the end of WWII. His rhetoric of America First harkens back to Warren Harding, who succeeded Woodrow Wilson after the US Senate rejected the League of Nations. Some historians refer to that period as ‘isolationism, ’ but in practice it was unilateralist.
World Bank’s latest Global Economic Prospects report … headlines:
Forecasts global real GDP growth at 2.7% in 2017 vs 2.3% in 2016
Forecasts advanced economies’ growth at 1.8% in 2017 (vs 1.6% in 2016)
Emerging/developing economies’ growth at 4.2% in 2017 (3.4% in 2016)
Forecasts US growth at 2.2% in 2017 (vs 1.6% in 2016) … they say their forecast excludes effects of any policy proposals from trump administration
Challenges for emerging market commodity exporters are receding, while domestic demand solid in emerging market commodity importers
Fiscal stimulus in US could generate faster domestic and global growth, but extended uncertainty over policy could keep global investment growth slow
Forecasts China’s growth slowing to 6.5% in 2017 (from 6.7% in 2016)
(Headlines via Reuters)
The World Bank looking at the recovering oil and commodity prices, noting this eases the pressures on emerging-market commodity exporters. Expects the recessions in Brazil and Russia to end.
As always the Bank notes uncertainties in its forecasts (all forecasters should), with upside uncertainty (in the short term at least) on US potential increased fiscal stimulus, tax cuts, infrastructure spending. Looking further out, though, a surge in debt load, higher interest rates & tighter financial conditions would have adverse effects.
Also downside potential on a more protectionist trade stance.
Could you survive on just $2.50 a day? According to Compassion International, approximately half of the population of the entire planet currently lives on $2.50 a day or less. Meanwhile, those hoarding wealth at the very top of the global pyramid are rapidly becoming a lot wealthier. Don’t get me wrong – I am a very big believer in working hard and contributing something of value to society, and those that work the hardest and contribute the most should be able to reap the rewards. In this article I am in no way, shape or form criticizing true capitalism, because if true capitalism were actually being practiced all over the planet we would have far, far less poverty today. Instead, our planet is dominated by a heavily socialized debt-based central banking system that systematically transfers wealth from hard working ordinary citizens to the global elite. Those at the very top of the pyramid know that they are impoverishing everyone else, and they very much intend to keep it that way.
Credit Suisse had just released their yearly report on global wealth, and it shows that 45.6 percent of all the wealth in the world is controlled by just 0.7 percent of the people…
As Credit Suisse tantalizingly shows year after year, the number of people who control just shy of a majority of global net worth, or 45.6% of the roughly $255 trillion in household wealth, is declining progressively relative to the total population of the world, and in 2016 the number of people who are worth more than $1 million was just 33 million, roughly 0.7% of the world’s population of adults. On the other end of the pyramid, some 3.5 billion adults had a net worth of less than $10,000, accounting for just about $6 trillion in household wealth.
And since this is a yearly report, we can go back and see how things have changed over time.
Fresh attempts at containing Russia and continuing the empire have been met with countermoves. Russia appears to be building strength in every way. Putin and his country have no intention of being under the American thumb, and are developing rapid resistance as the U.S. petrodollar loses its grip and China, Russia and the East shift into new currencies and shifting world order.
What lies ahead? It will be a strong hand for the countries that have the most significant backing in gold and hard assets; and China and Russia have positioned themselves very well. Prepare for a changing economic landscape, and one in which self-reliance might be all we have.
With all eyes on Russia’s unveiling their latest nuclear intercontinental ballistic missile (ICBM), which NATO has dubbed the “SATAN” missile, as tensions with the U.S. increase, Moscow’s most potent “weapon” may be something drastically different.
The rapidly evolving geopolitical “weapon” brandished by Russia is an ever increasing stockpile of gold, as well as Russia’s native currency, the ruble.
Take a look at the symbol below, as it could soon come to change the entire hierarchy of the international order – potentially ushering in a complete international paradigm shift – and much sooner than you might think.
The symbol is the new designation of the Russian ruble, Russia’s national currency.
Pakistan is making its first foray into international bond markets in almost a year as the country’s three-year, $6.6bn bailout programme from the International Monetary Fund draws to a close.
Citi, Deutsche Bank, Dubai Islamic Bank, Noor Bank and Standard Chartered have been hired to arrange the sale of a new 5-year sukuk – or Islamic bond – which will price later today.
The issuance marks Pakistan’s first appearance on international debt markets since a disappointing sale in late 2015, when the government’s hopes of borrowing $1bn were scuppered by high rates – forcing it to limit the sale of $500m.
According to the World Bank’s latest report, Pakistan has achieved greater macroeconomic stability in the last year, primarily due to fiscal discipline and a reduction in the current account deficit due to falling global commodity prices and the economy is forecast to grow by 4.7 per cent, up from 3.7 per cent three years ago. This has been reflected in higher prices for Pakistan’s existing bonds, which has pushed the yield on a 2024 bond down 2 percentage points since the start of the year to 6.4 per cent.
However the country faces a number of risks including deteriorating relations with India following an attack on Indian army base at Uri last month in which militants killed 17 soldiers. Indian officials claim the attack was perpetrated by Pakistan-based terrorist group, Jaish-e-Mohammad, and have vowed tough action in response.
The International Monetary Fund has lowered its growth forecasts for the US and other advanced economies, warning that the UK’s decision to leave the EU, the US presidential elections and rising protectionism are dragging on a world economy where politics now present the biggest risks.
Updating its semi-annual forecasts for the global economy on Tuesday, the IMF sharply lowered its 2016 growth forecast for the US to 1.6 per cent from the 2.2 per cent it predicted in July, and for advanced economies as a whole to 1.6 per cent
However, it said a rebound in emerging and developing economies, which the IMF now expects to grow by 4.2 per cent this year as group, would offset that figure, resulting in its forecast for global growth remaining steady at 3.1 per cent this year.
Maurice Obstfeld, the IMF’s chief economist, said the move “sideways” for the global economy hid what were still significant risks fed by a “cocktail of interacting legacies” from the 2008 global financial crisis. These included high debt overhangs, bad loans on banks’ books and moribund investment, which were continuing to depress the global economy’s potential output, he said.
Moreover, he said, low growth and a slow recovery from the 2008 crisis in advanced economies had fuelled “political tensions have now made advanced economies a major locus of policy uncertainty”.
The global economy is faltering again with growth rates “sliding back into the morass [they have] been stuck in for some time”, according to the Brookings Institution-Financial Times tracking index.
In a publication ahead of this week’s annual meetings of the International Monetary Fund and World Bank, the results will reinforce fears that many countries have become caught in a vicious circle of low growth, popular discontent and a backlash against trade and openness, resulting in more economic weakness.
The annual meetings will encourage policymakers to pursue inclusive and faster global growth as international organisations, finance ministers and central bank governors seek to reassure the public they can co-operate and that they have the necessary tools to break five years of economic disappointments.
Hanging over the meetings is the fear that the failure to improve living standards in advanced and emerging economies was important in the UK’s vote to leave the EU, may propel Donald Trump to the US presidency and will strengthen the hands of populists such as Marine Le Pen in France.
The World Bank is set to appoint Paul Romer, a longtime advocate of the economic power of human capital and student of urbanisation, as its new chief economist, bringing arguably the highest-profile name to the role since Nobel winner Joseph Stiglitz.
Mr Romer, a US economist who teaches at New York University, is expected to replace Kaushik Basu later this year. A spokesman for the bank would not confirm Mr Romer’s appointment but others within the institution did. His name is expected to be presented to the World Bank’s board as soon as Monday and announced publicly later in the week.
The move would put an important and occasionally provocative voice in economics in charge of the bank’s research department.
His 1990 paper arguing the case for “endogenous growth” — the theory that knowledge and innovation can spur growth — is considered one of the most influential papers in economics of the past 30 years.
“It’s an impressive choice,” said Scott Morris, a former US Treasury official who follows the World Bank for the Centre for Global Development. “It’s more in the [Larry] Summers and Stiglitz mold of picking an American superstar economist.”