Category: Economy

Portugal’s economy expanded faster than predicted in 2024, with a 1.5% increase in the fourth quarter, bringing the annual growth rate to 1.9%, exceeding the government’s 1.8% prediction, according to official figures issued on Thursday.

The National Statistics Institute (INE) revealed that the country’s GDP increased by 2.7% in the fourth quarter compared to the same time in 2023. This represented a substantial improvement above the prior quarter’s revised 0.3% growth rate.

INE attributed the acceleration to an increase in private consumption, aided by tax cuts, growing earnings, and higher pensions. Private spending, which has usually accounted for two-thirds of GDP, has played an important role in fuelling economic growth.

Despite robust domestic demand, exports of goods and services, notably Portugal’s thriving tourism sector, had a negative impact since rising imports outpaced export growth.

Economic expert Filipe Garcia stated that employment climbed by 1.5% in 2024, with the overall workforce expanding by an astonishing 25% since 2013. He also stated that immigration remains an important aspect of Portugal’s economic performance, warning that recent government curbs on immigrants must be carefully considered.

The government anticipates economic growth to accelerate to 2.1% by 2025.

India has approved a finance package worth 163 billion rupees ($1.88 billion) to boost its key mining sector. The information minister made the statement on Wednesday. This approach is consistent with India’s aim to obtain important raw resources, particularly lithium, which is critical for energy transition technologies.

According to reports, the federal Ministry of Mines had allocated this amount. The government also expects the public sector to invest an additional 180 billion rupees in vital mineral development projects.

According to an official release, the mission’s goal is to accelerate the exploration of vital minerals on land and offshore. In addition, cash incentives will be offered to stimulate mineral prospecting.

The financing supports India’s efforts to lessen reliance on imported minerals. Currently, the country is significantly reliant on external sources, particularly for lithium, a critical component in battery technology. While China dominates lithium processing, India is seeking to build its own capacity.

To do this, New Delhi has contacted countries such as Australia, Russia, and the United States for technical assistance in lithium processing.

In 2023, India designated 30 minerals, including lithium, as “critical” to help its energy transformation and industrial growth, lowering its dependency on imports.

The United Arab Emirates (UAE) has announced an ambitious high-speed train project to connect Abu Dhabi and Dubai. This ground-breaking effort reinforces the UAE’s status as a leader in innovative transport systems. The cutting-edge rail network is expected to alter regional mobility, setting new standards for efficiency and speed.

The train will go over 100 kilometres in 30 minutes, reaching speeds of up to 350 km/h. Passing through major vital regions and tourist hotspots, the project promises to provide travellers with an unforgettable travel experience.

Beyond convenience, high-speed rail is a game changer for the UAE economy. It is expected to add AED 145 billion to the country’s GDP over the next 50 years, bolstering sectors such as logistics and tourism.

According to the Dubai government, important milestones, such as tender issuing and network design clearances, have already been met, setting the path for efficient project implementation.

The train would provide seamless connectivity between the two emirates, enhancing the quality of life for both inhabitants and visitors. The project increases socioeconomic links while aligning with sustainable development goals by accelerating business growth and opening up new investment opportunities.

Qatar plans to propose three new laws as part of a complete overhaul of its legal structure, with the goal of attracting more international investment to the Gulf state. Qatar’s newly appointed minister of commerce and economy, Sheikh Faisal bin Thani, acknowledged the proposal in an interview. The new legislation contains a bankruptcy law, a public-private partnership (PPP) law, and a commercial registration law, all of which are intended to streamline company operations and create a more investor-friendly climate.

Sheikh Faisal emphasised that Qatar is revising 27 legislation from 17 government ministries, affecting almost 500 activities. He anticipates the revised bankruptcy and PPP rules to be finalised by March, providing additional clarity and support to investors.

Qatar, one of the world’s largest liquefied natural gas exporters, has set an ambitious aim of obtaining $100 billion in foreign direct investment (FDI) by 2030, as specified in its national development policy. However, the country has lagged behind regional competitors like as Saudi Arabia and the UAE, which have had higher FDI inflows in recent years.

Despite giving advantages such as tax breaks, free zone facilities, and long-term residency plans, Qatar’s investment inflows fell in 2023, indicating the need for quick regulatory reforms to catch up with its neighbours.

According to government sources, India intends to increase its agriculture budget by more than 15%, to almost $20 billion, in the fiscal year 2025-26. This is the greatest rise in six years, and it aims to raise rural earnings while keeping inflation under control.

The increased money will go towards producing high-yielding seed varieties, boosting storage infrastructure, and increasing the output of pulses, oilseeds, vegetables, and dairy products. The finance and agriculture ministries have yet to comment on the situation.

India, the world’s second-largest producer of rice, wheat, and sugar, continues to experience high food prices. While inflation in October 2024 exceeded 10% year on year, it has averaged more than 6% for the previous decade.

The 2019 budget would increase total allocations to agriculture and related industries to 1.75 trillion rupees, up from 1.52 trillion rupees this year. A share will also go towards research and development, which now receives 99.41 billion rupees.

Finance Minister Nirmala Sitharaman is scheduled to introduce the budget on February 1. The government also intends to increase pulse production to 30 million metric tonnes by 2030, enhance crop insurance, and provide subsidies to food processors.

Kenya’s National Bureau of Statistics (KNBS) will start providing core inflation data to improve the efficiency of monetary policy choices. Previously, KNBS concentrated on headline inflation, which includes volatile components such as food and petrol. This caused the Central Bank of Kenya (CBK) to compute non-food and non-fuel inflation separately in order to have a better understanding of underlying inflation patterns.

Core inflation, which removes volatile elements like food and energy prices, is a more reliable indicator of long-term inflationary pressures. KNBS emphasised the need of having an official and comprehensive core inflation indicator in line with worldwide central banking norms. Policymakers argue that maintaining price stability is difficult when headline inflation is caused by supply-side variables such as bad weather, which monetary tools cannot influence.

The change is designed to improve economic forecasts, assist the CBK in making appropriate interest rate decisions, and address disparities in inflation data between the KNBS and the central bank.

This move intends to promote transparency, maintain economic stability, and foster informed public communication about inflation, ultimately bringing Kenya’s inflation reporting in line with international standards.

Prabowo Subianto, Indonesia’s new President, has pledged 48.8 trillion rupiah ($2.99 billion) to develop the country’s new capital city, Nusantara, by 2029. This ambitious project aims to relocate the government to Nusantara by 2028, according to the project’s chief on Tuesday.

Former President Joko Widodo began construction on the $32-billion city in Borneo Island’s jungles in 2022. This legacy project was delayed due to the COVID-19 pandemic but has since regained momentum. Widodo envisioned Nusantara as a solution to Jakarta’s overpopulation and sinking issues, which are 1,200 kilometres (745 miles) away on Java Island. However, analysts believe that President Prabowo will not pursue the project with the same zeal as his predecessor, raising concerns about it becoming a “white elephant.”

According to data from the finance ministry, the government spent 75.8 trillion rupiah on initial developments from 2022 to 2024. The next phase will focus on housing and offices for the parliament and judiciary, as most executive branch offices have already been completed, according to Nusantara authority chief Basuki Hadimuljono.

To support the project, the government is also looking for private investment. Citadel Group, among others, will soon begin construction on hotels, housing, and office spaces worth 6.5 trillion rupiah.

The Philippines has taken a huge step forward in its energy transition by signing a $15 billion renewable energy agreement with Masdar in the UAE. The agreement, signed in Abu Dhabi, focusses on the development of solar, wind, and battery energy storage technologies, with the goal of generating up to 1 gigawatt of sustainable energy by 2030 and increasing to 10 GW by 2035.

Currently, renewable energy accounts for around 22% of the Philippine energy mix. The government plans to boost this to 35% by 2030 and 50% by 2040. Philippine Energy Secretary Raphael Lotilla emphasised that the agreement would help the country meet its renewable energy targets while also improving energy security and creating jobs.

The collaboration follows President Ferdinand Marcos Jr.’s visit to the UAE in November, during which agreements on investment, artificial intelligence, and energy transition were made. The project also marks Masdar’s entry into the Philippine renewable energy sector.

With coal accounting for more than half of the country’s electricity, the Philippines is looking at sustainable power options to deal with frequent outages and high energy bills. Lotilla went on: “Together, we are positioning the Philippines as a regional leader in sustainable energy.”

Singapore President Tharman Shanmugaratnam highlighted India’s growing role as a global economic powerhouse during his visit to Odisha. He emphasised Singapore’s commitment to supporting India’s semiconductor ecosystem, aviation connectivity, and skilling programs.

“India aims to be a geopolitical and economic powerhouse in a multipolar world. “We want to collaborate with India,” Shanmugaratnam said, citing the country’s demographics, development trajectory, and export possibilities.

The President highlighted India and Singapore’s shared priorities under the India-Singapore Ministerial Roundtable, which include the creation of a semiconductor ecosystem and industrial parks. He cited Sembcorp’s active pursuit of new industrial park locations in India.

Another key area is skill development, with Singapore harnessing its expertise to help India’s skill development ecosystem thrive. Sustainability was also highlighted as a significant collaboration area, with Singapore eager to participate in India’s solar, wind energy, and green ammonia sectors, as well as the establishment of a green corridor to Southeast Asia.

Shanmugaratnam emphasised the importance of connectivity and urged the expansion of the air service agreement, which was last amended a decade ago. Improved aviation linkages would strengthen both countries’ economic ties and enable tighter cooperation.

The President’s statements reiterated India and Singapore’s strong alliance, which aims to promote growth in important areas.

According to government sources, India intends to project nominal economic growth of 10.3%–10.5% for the upcoming fiscal year, which is higher than the current year’s forecast of 9.7%. As the country prepares for its slowest growth in four years in 2024–2025, the optimistic prognosis attempts to allay fears of an economic slowdown.

N.R. Bhanumurthy, director of the Madras School of Economics, stated that the growth forecast, which is fuelled by government capital expenditures, agriculture, and a resurgence in exports, is feasible. The administration of Prime Minister Narendra Modi has prioritised increasing growth through infrastructure spending, production-linked incentives for manufacturing, and corporate tax cuts.

To boost demand among salaried workers impacted by slow pay growth and high food inflation, Finance Minister Nirmala Sitharaman is anticipated to announce personal income tax cuts in the February 1 budget. Despite these measures, India is still committed to lowering its fiscal deficit. It projects this year’s budget shortfall to be 10–20 basis points smaller than the 4.9% early forecast, which was partially caused by spending delays brought on by the monsoon and elections.

India wants to reduce its fiscal deficit to less than 4.5% in the upcoming fiscal year.