ºìÌÒÊÓƵ Blog Archive February 2016

Have you had a chance to check out the latest segments from the ? February’s podcasts feature , nationwide, and a (AIB). The segment on MSU’s International Business Center provides a summary of accomplishments made in 2015 and a preview of what is to come for 2016. to navigate to the ºìÌÒÊÓƵ Business Beat page and listen to the latest podcasts!

, with its growth forecast for 2016 dropping from 1.7% to .9%. Making matters worse, the rand, South Africa's national currency, has depreciated by 30% over the last 18 months. Currently, the government is taking many different measures to stop the country from entering into recession and to please the rating agencies who are threatening to downgrade South Africa's debt to junk status. Both of these could have dramatic effects on the country and its relationship with foreign investors.

A referendum is a vote in, and can cast a “Yes” or “No” vote to a question, and whichever side has over half of the votes cast wins. U.K.’s Prime Minister David Cameron announced a referendum on June 23, 2016 to vote on whether the should remain a part of the European Union. Britain held a referendum in 1975, and voted to stay; however, there are many who called for another vote because they argued that the  has changed over the past 40 years.

Over the past two decades, China's economic growth has  and national income has been . This significant growth can be attributed to China's timely . However, expansion cannot last forever. The amount of raw materials being produced in  is continuing to increase, but demand for these materials is decreasing. Decreasing demand has contributed to the initial slow-down following China's rapid expansion, but if production itself is not moderated, could suffer greater consequences.

Nigeria needs money. Specifically, it needs $3.5 billion worth of cash flows for their $15 billion government driven deficit. The recent global oil glut has left Africa, and especially Nigeria, . Other countries, like , are facing similar untimely crises as the decade-long commodity boom is coming to an end. Before, growth in Africa relied upon the abundance of land, which left no necessity for advanced infrastructure or substantial growth in other sectors. Dependence on uncontrollable factors, it seems, has left Africa’s largest and most advanced economies in the early stages of economic stagnation.

The United States government has of a $5 to $10 million dollar heavy equipment factory in Cuba’s Mariel port and special economic zone located 30 miles west of the Cuban capital of Havana. This announcement comes merely . The Oggun Tractor Plant, as it is to be named, marks the first significant American business investment in the small island nation since the rise of Fidel Castro in 1959, when  worth of American corporate and private property was nationalized.

If you are looking to learn more about the ASEAN Economic Community, look no further than ºìÌÒÊÓƵ. On our website's , you can find information about member countries, financial and trade statistics, and the history of the trade bloc. In addition, we also have a plethora of resources on ASEAN, including pages about the ASEAN Economic Community. Check out our ASEAN and AEC resources !

The trade community encompasses a group of dynamic economies that seem poised to experience rapid growth and gains in wealth. As with any entity that exudes potential, however, the ASEAN trade bloc faces significant challenges as a trade bloc and as independent nations. The beginning of the (ASEAN Economic Community) will present a whole list of new issues along with its great promise.

Two new U.S. International Trade Administration (ITA) resources are now available on ºìÌÒÊÓƵ and they can be found in the  of the  of ºìÌÒÊÓƵ.

ITA Trade Leads provide contract opportunities for selling their products and services overseas. This new resource is particularly important for U.S. businesses because it’s often difficult for them to learn about overseas opportunities, especially those within complex industries where partnerships and sub-contracts are the norms. Currently, these leads come from six different sources and are updated daily. Users can browse through all of the available trade leads for a certain country or search the leads using keywords.

ITA Consolidated Screening List (CSL) is a list of parties for which the maintains restrictions on certain exports, re-exports, or transfers of items. This resource conducts electronic screens of potential parties to regulated transactions. In the event that a company, entity, or person on the list appears to match a party potentially involved in your export transaction, additional due diligence should be conducted before proceeding. CSL is a collection of eleven export screening lists of the Departments of Commerce, State and the Treasury, and it is updated daily. Lists of screened companies, entities, and individuals can be browsed by country or can be searched by keywords.

The ºìÌÒÊÓƵ team is excited to introduce our newly redesigned country risk pages. Each country risk page can be accessed individually for via the . These new pages now allow users to not only see both the country risk and business climate risk for each country, but also compare that risk rating to other countries around the globe using an interactive map, color-coded by risk rating. Users can also read about each country’s strengths and weaknesses which contribute to the risk, as well as current economic and financial trends occurring in the country. Check out these to learn about country risk and business climate today! 

In the third part of this week’s blog series on the Economic Community (AEC), we will look at the many economic and investment opportunities created with the formation of the new economic bloc, along with some possible economic implications in the region. With a combined population of 625 million and a relatively low GDP per capita, many see the . The economic community has the potential to significantly impact all ten participating countries, as a reduction in tariffs and freer trade could open new avenues for many businesses in the bloc, as well as foreign companies looking to expand.

The main focus of the recently launched  is to create a single market and production base, support member nations in a world of increasing competitiveness, and to close economic disparities. Overall, the underlying aim is to further integrate Asian economies with the global economy. has expressed interest in the AEC, according to a survey conducted by Germany Invest. The survey found that German firms currently operating within ASEAN are excited by the new opportunities that the AEC might bring for their businesses. In the past, hesitance has prevented German firms from leading against competitors such as Japan, who has successfully been leveraging tariff removals and other benefits found in the region. The AEC will bring exciting new benefits and business opportunities to members in its region. However, despite the AEC appearing to be the next European Union, it has a long way to go in terms of integration.

The ASEAN Economic Community (AEC) is not yet a household name, but it certainly has the power to become one. Officially launched on January 1, 2016, the - Brunei, Cambodia, Indonesia, Laos, Malaysia, Burma, the Philippines, Singapore, Thailand, and Vietnam - into a unified market and production base. However, the AEC will not attempt to implement uniform economic policies throughout the region. It sees diversity among its members as a strength and an attribute that will make it attractive to global investors. With a combined GDP of $2.4 trillion, this new economic community will look to have tremendous impacts on global markets and .

with no end in sight. The country has the highest inflation in the world, topping countries such as and . There are five apparent causes that have led to the downfall in , including political instability, food crisis, oil prices, currency exchange rates, and the country's default. Because of Venezuela's hurting economy, many companies from around the world are taking hits on profits and cutting back business within the country.

tough economic sledding continues. The Land of the Rising Sun faces currency appreciation without the underlying fundamentals to support it. A myriad of issues have led to weak economic conditions in Japan, and the recent appreciation of the yen isn’t helping at all. In fact, it is a counteractive force to Japanese monetary policy, and is causing headaches for Japanese firms.

, making it one of the world’s fastest growing economies. Already the 3rd largest economy in the world, India outpaced China’s growth of 6.8% in the same period, and far surpassed its own growth rate of 6.6% in the same period last year. Although it may seem odd that India’s economy is growing faster than China’s, it has happened before. According to the , India’s economy outpaced China’s in 1981, 1989, 1990, and 1999, but 2015 is the first case of this occurring in this millennium. However, as stock prices have recently dipped and a new calculation of GDP has been utilized, economists and analysts are reluctant to believe that India’s GDP is the only piece of the puzzle.

Baby Boomers worked in a strict hierarchical structure: you stayed in a position for a certain amount of time before being promoted, you reported to your boss and kept conversations strictly employer/employee related, you worked nine to five in the office, and you rarely left your original firm in search of new opportunities. Millennials are here to change that.

The Bank of Japan reduced interest rates to below zero on Friday, after years of keeping them in the positive range. The negative interest rates will be placed initially on reserves valued at 10-30 trillion yen and will apply only to new reserves that financial institutions deposit at the central bank. The goal is that the reduction would cause the real interest rates to decrease, thus . This policy will decrease rates for lending and isn’t supposed to negatively affect banks. The Bank of will be dividing the account balances into 3 tiers, and the interest rates placed depending on the type of reserves that are placed in the Bank of Japan.

Art sales reached an incredible peak over the past few years. Billionaires and other wealthy art enthusiasts around the world have taken joy in paying exorbitant prices for pieces by both well-known and up-and-coming artists. Many of these pieces are fed into personal collections, some of which are put on display. The art collecting habit, popular among the global affluent, has driven prices of popular art to the hundreds of millions. Big name international auctioneers have thrived and the industry has reached unprecedented levels of prosperity. However, 2015 saw a decrease in reported sales for the first time in six years, causing many to believe .

Auto maker giant, General Motors, recently announced its fourth quarter earnings. After a record year, GM  in the last quarter of 2015. This was caused by consumers buying less gas efficient models, as gas in  has continued to stay very low at around $2 a gallon. Sales in North America rose 8.6% in the final quarter and 14% in . This could have a great impact heading into 2016, where consumers were initially predicted to go more into electric vehicles and more gas efficient models. If the current trend stays true, then the first quarter of 2016 could spike as well. In Europe, the company continues to struggle as they are still in the negative in the difficult continent. However, GM's CFO has stated leading many to view GM's prospects in the region optimistically.

Africa’s largest economy, , is seeking loans from the World Bank and African Development Bank (ADB) to help fund its forecasted budget deficit. Historically, Nigeria’s budget has been financed primarily with oil revenues, but the recent plummet in oil prices has slashed the amount of funding produced by this sector. Nigeria is not alone in this situation, as other nations such as , , , and are also in dire economic straights due to an overreliance on oil production.

After a tedious war that took a toll on its people, Chechnya remained under the control of Russia following its annexation. After a very close outcome on the 2012 referendum, Scotland remained a loyal entity of the Queen’s monarchy. While both attempts of secession were predictably unsuccessful, it seems Spain’s biggest problem isn’t going to be a gruesome war or rioting masses in the streets. If Cataluña is successful in efforts of secession from Spain, it’ll be out of the frying pan and into the fire for the Iberian democracy.

The World Health Organization (WHO) will convene in an emergency committee in Geneva, Switzerland this Monday, January 31. The topic of this emergency meeting will be the mosquito-borne Zika virus, which is spreading “explosively” across Latin America. Margaret Chan, WHO Director-General, addressed the executive board stating that