Tag Archives: Economy

The Rise of China and the Fall of the ‘Free Trade’ Myth

‘America first does not mean America alone,” President Trump declared last month at the World Economic Forum in Davos, Switzerland. This sudden burst of pragmatism from an avowed nationalist showed what a difference a year can make. Denouncing the “false song of globalism” during his presidential campaign, Trump, on his third full day in office, canceled the Trans-Pacific Partnership, a regional trade deal with Japan and 10 other countries. He then denounced Canada, Germany and South Korea for exporting more to the United States than they import. He promised to renegotiate trade pacts with Europe, Canada and Mexico and get a better deal for American workers. In Davos, however, he reached out with conciliatory words to the very free-trading and globalizing elites he has consistently maligned.

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Posted by on August 9, 2018 in Asia


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Africa’s free trade fairy tale

A cross section of Africa’s most powerful people gathered in Kigali this week to sell a dream – and sell it hard.

Rwandan President Paul Kagame, who revelled in his role as host of this extraordinary African Union (AU) summit, described this dream as “among the most consequential actions that this Assembly has ever taken”. Former Nigerian President Olusegun Obasanjo said that anyone who did not support it was a “criminal”. South Africa’s Cyril Ramaphosa invoked not one but three liberation heroes to underscore the significance of the moment:

“This is probably just as important as the formation of Organisation of African Unity (OAU). This is what Kwame Nkrumah dreamt of, what Julius Nyerere wanted to see, what Nelson Mandela wanted to see realised. It’s truly a new dawn for Africa,” he said.

The presidents were speaking, of course, about the signing of the African Continental Free Trade Agreement, a landmark trade deal that would create a single market from the Cape to Cairo, and from Djibouti to Dakar.

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Posted by on April 7, 2018 in Africa


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Investeren in kinderobligaties

Er is iets vreemds aan de hand met de lichting jong volwassenen die geboren is tussen grofweg 1980 en 2000. Het is de meest intensief opgeleide generatie ooit. Niet eerder in de geschiedenis heeft een geboortecohort zoveel onderwijs genoten en zoveel diploma’s gehaald. Volgens de logica van de kenniseconomie zou zich dat moeten uitbetalen. In hogere salarissen, bijvoorbeeld, in robuuste banen en groeiende welvaart. Maar gelegd langs die meetlat zijn ze slechter af dan hun ouders en grootouders. ‘Iedere autoriteit, van moeders tot presidenten, heeft millennials op het hart gedrukt zo veel mogelijk menselijk kapitaal te verzamelen’, schrijft Malcolm Harris in zijn zojuist verschenen Kids These Days: Human Capital and the Making of Millennials. ‘En dat hebben we gedaan. Maar de markt heeft zich niet aan zijn kant van de afspraak gehouden. Wat is er gebeurd?’

Inderdaad, wat is er gebeurd? Hoe kan het dat, ook in Nederland, de arbeidsproductiviteit nog altijd een stijgende lijn vertoont, maar dat de gemiddelde beloning per werknemer is gestagneerd? De miljoenenvraag is, letterlijk, wie hier de extra winst opstrijkt. ‘Het aantal vaste arbeidscontracten neemt af ten gunste van andere baansoorten’, zo luidt de verklaring van het cbs bij deze

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Posted by on February 19, 2018 in Reportages


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Post-Davos Depression

The CEOs of Davos were euphoric this year about the return to growth, strong profits, and soaring executive compensation. Economists reminded them that this growth is not sustainable, and has never been inclusive; but in a world where greed is always good, such arguments have little impact.

DAVOS – I’ve been attending the World Economic Forum’s annual conference in Davos, Switzerland – where the so-called global elite convenes to discuss the world’s problems – since 1995. Never have I come away more dispirited than I have this year.–stiglitz-2018-02

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Posted by on February 1, 2018 in Economy



The great globalisation lie

Not so long ago, the argument over globalisation was seen as done and dusted—by parties of the left as much as of the right.

Tony Blair’s 2005 Labour conference speech gives a flavour of the time. “I hear people say we have to stop and debate globalisation,” Blair told his party. “You might as well debate whether autumn should follow summer.” There would be disruptions and some might be left behind, but no matter: people needed to get on with it. Our “changing world” was, Blair continued, “replete with opportunities, but they only go to those swift to adapt” and “slow to complain.”

No competent politician today would be likely to urge their voters not to grumble in this way. The Davos set, the Blairs and the Clintons are all scratching their heads, asking themselves how on Earth a process they insisted was inexorable has spun into reverse. Trade has stopped growing in relation to output, cross-border financial flows have still not bounced back from the global crisis of a decade ago, and after long years of stasis in world trade talks, an American nationalist has ridden a populist wave to the White House, where he disavows all efforts at multilateralism. Those that were cheerleaders of hyper-globalisation at the turn of the century stand no chance of understanding where it has gone wrong without realising how little they understood the process they were championing.

Back in 2005, in that same Blair conference speech, there was scope for doubt, and “no mystery about what works: an open, liberal economy, prepared constantly to change to remain competitive.” What of social solidarity? Would globalisation sweep it away? Blair insisted it could survive, but only if it were repurposed. Communities could not be allowed to “resist the force of globalisation”; the role of progressive politics was merely to enable them “to prepare for it.” Globalisation was the foregone conclusion; the only question was whether society could adjust to the global competition.

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Posted by on January 24, 2018 in Economy



Trump, Macron: same fight

It is customary to contrast Trump and Macron: on one hand the vulgar American businessman with his xenophobic tweets and global warming scepticism; and on the other, the well-educated, enlightened European with his concern for dialogue between different cultures and sustainable development. All this is not entirely false and rather pleasing to French ears. But if we take a closer look at the policies being implemented, one is struck by the similarities.

In particular, Trump, like Macron, has just had very similar tax reforms adopted. In both cases, these constitute an incredible flight in the direction of fiscal dumping in favour of the richest and most mobile.

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Posted by on January 9, 2018 in Economy, European Union, North America


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A Good German Idea for 2018

ATHENS – By 2016, almost all Europeans had realized that radical policy and institutional reforms were essential to revive the European project. Yet serious reform was impeded by the usual disagreement about what should be done – a dispute that Emmanuel Macron, France’s new president, once described as a “holy war” between German and French elites.

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Posted by on January 5, 2018 in Economy, European Union


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Bitcoin Is the Most Obvious Bubble of the Modern Era

To call Bitcoin the biggest and most obvious bubble in modern history may be a disservice to its surreality.

The price of bitcoin has doubled four times this year. In early January, one bitcoin was worth about $1,000. By May, it hit $2,000. In June, it breached $4,000. By Thanksgiving, it was $8,000. Two weeks later, it was $16,000.

This astronomical trajectory might make sense for a new public company with accelerating profits. Bitcoin, however, has no profits. It’s not even a company. It is a digital encrypted currency running on a decentralized network of computers around the world. Ordinary currencies, like the U.S. dollar, don’t double in value by the month, unless there’s a historic deflationary crisis, like the Panic of 1837. Instead, bitcoin’s behavior more resembles that of a collectible frenzy, like Beanie Babies in the late 1990s.

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Posted by on December 31, 2017 in Economy, Reportages


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The Petro-Yuan Bombshell

The new 55-page “America First” National Security Strategy

(NSS), drafted over the course of 2017, defines Russia and China as “revisionist” powers, “rivals”, and for all practical purposes strategic competitors of the United States.

The NSS stops short of defining Russia and China as enemies, allowing for an “attempt to build a great partnership with those and other countries”. Still, Beijing qualified it as “reckless” and “irrational.” The Kremlin noted its “imperialist character” and “disregard for a multipolar world”. Iran, predictably, is described by the NSS as “the world’s most significant state sponsor of terrorism.”

Russia, China and Iran happen to be the three key movers and shakers in the ongoing geopolitical and geoeconomic process of Eurasia integration.

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Posted by on December 31, 2017 in Asia, Economy, Europe


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The High Cost of Denying Class War

The rise of populism on both sides of the Atlantic is being investigated psychoanalytically, culturally, anthropologically, aesthetically, and of course in terms of identity politics. The only angle left unexplored is the one that holds the key to understanding what is going on: the unceasing class war waged against the poor since the late 1970s.

ATHENS – The Anglosphere’s political atmosphere is thick with bourgeois outrage. In the United States, the so-called liberal establishment is convinced it was robbed by an insurgency of “deplorables” weaponized by Vladimir Putin’s hackers and Facebook’s sinister inner workings. In Britain, too, an incensed bourgeoisie are pinching themselves that support for leaving the European Union in favor of an inglorious isolation remains undented, despite a process that can only be described as a dog’s Brexit.

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Posted by on December 30, 2017 in Economy, Europe, North America


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