Category: Economy

The African Summit that began on Tuesday, September 7, organised Collective action to combat climate change, was listed as the key agenda at the inaugural Caribbean Community and the African Union (CARICOM).

The virtual meeting will bring CARICOM and African Union Heads of States and Government from the Caribbean community together. They will deliberate the trade and investment between the two nations. The summit will be on “Unity between continents and oceans: opportunities to deepen integration”

The statement released from Kenya’s Foreign Office said that the Participants at the event will include Heads of State and the Government of the Caribbean Community and the African Union. The session will be chaired by President Uhuru Kenyatta which was earlier slated for 2020 but triggered the cancellation due to the pandemic.

Barbados prime minister Mia Mottley opened the Caribbean community diplomatic office at Two Rivers Complex on Limuru Road during her visit to Kenya in December 2019. She said that their region and Africa are not just separated not just by the Atlantic Ocean but by centuries of division and exploitation and they will not not allow this separation to continue further.

El Salvador became the first country to accept cryptocurrency Bitcoin as legal tender. Nayib Bukele, President of El Salvador and advocate of digital currency said that the policy that took effect on Tuesday made the morning historic.

The nation opened its digital wallet app to residents and consumers for the first time. However, the first few hours for the status of Bitcoin in the country were marred by technological hiccups. The government of El Salvador holds 550 Bitcoin which is equivalent to $26 million.

Earlier the president suggested that the legalization of Bitcoin will spur investment in the country and that it can help approximately 70% of Salvadorans who lack access to “traditional financial services”. In his statement on Monday, he said that they must break with the paradigms of the past. He believes that El Salvador has the right to advance toward the first world. He further added that using Bitcoin can be an effective way to transfer billions of dollars. The transfer will be in remittances and Salvadorans who are living outside the country send them back to their homeland each year.

Bukele’s government is being criticized by political opponents and is facing pushback from the international community over a recent court decision that is seen as unconstitutional.

China wants to import more African agricultural products across its e-commerce platform and wants to expand the sales as per a senior Chinese foreign ministry official.

The director-general of the ministry department of African affairs Wu Peng said at the launch of “African Products Online Promoting Season” that the nation has never stalked surplus trade with Africa. He said the online promotion will be helpful for African products, especially agricultural products that will gain more market shares in China. The country will encourage e-commerce with live streaming platforms to promote the export of agricultural products.

In the first seven months of the year, the trade volume between the two nations reached $139.1 billion. According to China’s ministry of commerce, these imports from Africa were $59.3 billion.

70% of the East African country’s sales to the Asian economic giant are mineral’s despite the small size of its resources industry. The main exports to China according to the 2019 data by the Observatory of Economic Complexity are titanium ore, niobium, tantalum, vanadium and zirconium ores, iron ore, and manganese ore.

Currently, agricultural products that are imported by China are tea, coffee, and cut flowers which are not among the top five imports for the nation.

President Xi Jinping announced that a new Beijing Stock exchange will be set up as part of this year’s China International Fair for Trade in Services. He remarked this in a video link at the Global Trade in Service Summit on September 2.

Jinping believes this to be the primary platform to serve the leading innovation-oriented small and medium-sized enterprises (SMEs). Its decision caught widespread attention as the Beijing Stock Exchange will become the main financing provider for innovation-driven small-sized enterprises. It is the latest deepening reform known as the New Third Board of the National Equities Exchange. It will comprise of Shenzhen Stock Exchange and the Shanghai Stock Exchange which are the growth enterprise board and the science and technology innovation board respectively.

According to the China Securities Regulatory Commission, the reform of the New Third Board will embark on a new journey after the Beijing Stock Exchange is set up and starts running. It will be based on the innovation-driven SMEs selected from the New Third Board and will be an upgraded version to be precise.

The three stock exchanges will form a three-pillar framework for the nation’s capital market with different focuses and meet the diverse demands of different kinds of enterprises.

On Monday, the world’s top exporter Saudi Arabia slashed crude prices for Asia over the weekend as oil prices extended losses. This signaled that the global markets are well supplied.

Since November, the Brent crude futures fell 98 cents (1.8%) to $71.63 a barrel by 0613 GMT and US West Texas Intermediate crude for October fell 95 cents (1.4%) to $68.34 a barrel. On Sunday, a statement was released from the state oil giant Saudi Aramco to the customers that they will cut October prices by at least $1 a barrel for all crude grades sold to Asia. Asia is their biggest buying region and the cuts in prices were larger than expected among Asian refiners.

In August the Asian customers requested fewer Saudi volumes as the delta variant prompted the return of movement of restriction. OPEC group expects the global oil market to continue tightening this year. They plan to receive output before flipping into surplus again in 2020.

The US indicated a patchy economic recovery that signals a slower fuel demand during a resurgent pandemic after the decline in crude. In the wake of Hurricane Ida, the losses were capped by the concerns that US supply would remain limited.

On Wednesday, India’s External Affairs Minister Dr. S. Jaishankar and Iran’s new foreign minister Amir Abdollahian held talks with the top focus on the Afghanistan situation and the Chabahar port project. This was the first time when the call was exchanged between S. Jaishankar and Amir Adbollahian since he took charge as the finance minister. Jaishakar also congratulated Amir on his new position.

Both nations agreed to continue the consultations with the Iranian readout saying that Amir reiterated Tehran’s “principled policy to support the formation of an inclusive government in Afghanistan” that is made up of “all Afghan ethnic groups”. Amir also emphasized a regional approach to “defuse the crisis in the nation”.

Dr. S. Jaishankar took to his Twitter account to announce that India appreciates Iran’s facilitation of Indian repatriation flights from Afghanistan and agreed to strengthen their bilateral cooperation and discussed pressing regional issues. In September, India had evacuated more than 500 people after the fall of Afghanistan.

On the Chabahar port project, Amir called for “speeding up the project and expanding trade with India”. This project is Key to India’s connectivity to its west that provides links to Afghanistan and Central Asia. It is also key to the International north-south transport corridor that connects Mumbai to Moscow.

On Wednesday, Japan launched a new Digital Agency with the hope to bring a much-needed overhaul to antiquated systems that have had their shortcomings highlighted by the pandemic. Japan tried to give its government services and record-keeping a technological upgrade.

Currently, the country has old-fashioned paperwork for its people to apply for government services, and the central and local government offices use different systems for storing and managing the data which lacks compatibility.

During the Pandemic, the lack of digitalization for the government services became the major problem that caused delay and mishandling of applications for financial subsidies and support. It also slowed down the medical data transmission needed for the virus measures.

Prime Minister Yoshihide Suga’s political priority has been to promote digitalization to push administrative reforms since he took office last September. Digital Transformation Minister Takuya Hirai will head the agency with 600 staff that includes 200 people hired from the private sector and others transferred from other ministries.

It aims to digitize 31 areas for administrative procedures such as elderly care and childrearing as they standardize different systems used by municipalities within five years. They also plan to promote the use of a 12-digit ‘My Number’ assigned to all individuals. That will be issued as a multi-purpose identification card.

On Wednesday, the Organization of the Petroleum Exporting Countries (OPEC) oil producer’s cartel and allied non-member countries led by Russia signed off on gradually increasing production. The global economy’s demands for fuel continue to recover from the worst of the coronavirus pandemic.

The US pressured the OPEC group to move faster in restoring the production which was cut during the pandemic. The US asked them to potentially ease costs at the pump for American drivers. OPEC+ agreed via online meeting to follow the earlier plan to produce 4,00,000 barrels per day from October 1. The cartel and its allies are diligently trying to restore deep cuts from 2020’s lockdown which lessen the demand for fuel amid travel restriction.

The price of oil slipped to 0.4% at $68.26 per barrel on the New York Mercantile Exchange and crude oil traded down 0.4% at $71.36 per barrel which was an international benchmark. However, the recovery was seen with a slump to just above $62 for New York Mercantile Exchange crude on August 20.

An increase in supply of oil can cause a slip in price as it did in August while holding back the production can cost members money for their budgets.

The Indian economy grew by 20.1% in the April-June quarter as compared to last year’s same period. In 2020 Indian economy suffered a recorded contraction.

This is marked as the fastest pace of growth since the nation began publishing quarterly gross domestic products in 1996. This percentage is far higher than the January-March quarter where the economy grew 1.6%. The nation battered the coronavirus and a months-long nationwide lockdown which contracted 24.4% in the quarter of April-June in 2020. It pulled the country into recession. The country faces a recession when the economy contracts for two successive quarters. Despite the catastrophic surge in coronavirus infection throughout the country from March to early June, the Indian economy rebounded.

However, India avoided another nationwide lockdown, many industrial states were reimposed to localize restrictions to slow the spread of the infection. Fresh cases and deaths saw a sharp decline from their peak and the vaccination administration has picked up the pace.

In the fiscal year 2020-21, Asia’s third-largest economy India has suffered one of the biggest seatbacks where it contracted by 7.3% worsening from a slump that slashed growth to 4% from 8% in a two-year span before the pandemic.

On Tuesday, China’s foreign ministry spokesperson Wang Wenbin said that imposing sanctions on the Taliban in Afghanistan will prove counterproductive and has urged the international community to support chances for positive development in the country.

Wang Wenbin also said that Afghanistan is an independent and sovereign country and the United States and its allies should learn from the lessons of history. It reflects and acts prudently on issues related to Afghanistan. He further added that imposing sanctions and pressure at every turn cannot solve the problem and that it will only be counterproductive. Wang responded to the reports that said the world leaders meeting at the G7 could consider new sanctions on the Taliban.

He believed that they should not let the tragedy of individual countries making mistakes only to have Afghan people and the international community, especially regional countries, foot the bill, be repeated. The international community needs to encourage and help in promoting the development of the situation in Afghanistan in a positive direction. It should also support the peaceful reconstruction and improve the well-being of the people and also enhance its capacity for independent movement.

China has sought to maintain friendly ties with the Taliban who shares the border with Afghanistan. China has seized on the US pullback from the country to sharpen its criticism of Washington.