EUROPE
A shot in the arm for Huawei
Following up to the story from two weeks ago, on US imposing a ban on Huawei accessing 5G technology, on 17th February, the UK intelligence declared the risk to be manageable. Neither UK nor Germany were convinced of the necessity of a ban or the possibility of any potential threat of sabotage from China to be mitigated. This follows a series of recent disagreements over policy between the US and its Transatlantic allies which are expected to follow their policies.
Source: Financial Times
ECJ overturns the European Commission decision
The Commission’s claim that Belgium had extended 700 million euros of de facto aid through a tax scheme was rejected by the European Court of Justice. This related to an alleged tax scheme where large corporations could lower their tax base on ‘excess profits’ giving them an unfair advantage, according to the Commission. This decision could have its implications in other tax recovery cases under appeal worth nearly €1.6 billion.
Source: Financial Times
Keep an eye on
- Brexit (yes, still.)
- Huawei and 5G Developments
- US Border / National Emergency
EMERGING MARKETS
Middle East military spending increases
Because of political tensions with regional rivals, defense spending is increasing rapidly in the middle-east. UAE has declared about $1.35 billion in defense deals with local and international companies.
Source: CNBC
Uzbekistan to debut with first bond sale
Through its first international bond offering, Uzbekistan aims to be more accountable to the world. This follows a series of reforms aimed to improve business, political and civil liberties, following the death of Islam Karimov, the dicator in 2016.
Source: Financial Times
Venezuela’s GDP falls by 54% from 2013 peak
Venezuela’s economic collapse exceeds that of the former Soviet Union. It is also the second most severe economic crash behind Zimbabwe. Maduro’s policies along with rampant corruption led to increasing food shortages, hyperinflation, disease and violence.
Source: Financial Times
Argentinian current account deficit widens to 6.6%
CHINA & JAPAN
China’s debt to GDP ratio to increase according to UBS
UBS believes this year will be one of constant re-leveraging for China due to the country’s current economic slowdown. Lending to the private sector is expected to be increased as well as the overall debt as shown in the graph below. Estimates say that Chinese nominal GDP growth will be slowed this year to about 8% from last year’s 9.7% figure.
Source: Bloomberg
China to build its own space station
Chinese space ambitions are rapidly increasing. After their recent probe to the far side of the moon where they have grown cotton seeds, China is now developing a prototype for a the first ever power station in space. This venture is alongside their aspiration to complete a Chinese space station named “Tiangong” within the next three years.
Source: Bloomberg
US & CANADA
Canadian beef producers see increased exports to Japan
Japanese imports of Canadian beef have surged on account of the TransPacific Partnership reducing the tariffs among member countries. Japan had to cut tariffs on beef from 38.5% to 27.5%, giving an edge to members of the TPP.
Source: Financial Times
US industrial output falls for the first time in 8 months in January
Manufacturing fell by 0.9% due to a fall in motor vehicle assemblies. The ongoing trade war and slowdown in the Chinese economy were also cited as a reason in the dip in manufacturing. The cold weather helped raise utilities output to 0.4%, while mining output rose by 0.1%.
Source: Financial Times
South Korea’s unemployment rate grows to a 9-year high.
Written jointly by Kaushik PSK, Sahil Bansal, Sophia Boucher, Leo Bouvier, Deepak Chathoth Narayanan, Kaline Larousse, Nisham Hussain M, Anirudh Parthasarathy and Tejwinder Randhawa.
Disclaimer: This newsletter contains information about Financial markets and college events. This information is not advice and should not be taken as such.