EU can become a trendsetter and bolster world GDP

2019 ◽  
Keyword(s):  
Public Debt ◽  
Economic Conditions ◽  
Budget Deficits ◽  
Content Type ◽  
The Face ◽  
Economic Slowdown ◽  
Global And Local ◽  
Global Influence ◽  
The Eu ◽  
Debt Levels

Subject The global reach of Germany's fiscal scope. Significance The focus on euro-area debt fragility perhaps obscures the fact that the bloc and broader EU have strengthened their fiscal position. They can afford to take action in the face of the global and local economic slowdown. Public debt levels and budget deficits have shrunk since 2014, especially in Germany and the Netherlands, which enjoy substantial budget surpluses and moderate debt levels. Impacts Action would prevent the EU from looking feeble and unable to respond to, let alone influence, shifts in global economic conditions. A change in perceptions of the EU and its capabilities might boost local and global sentiment, multiplying the influence of any stimulus. Illustrating Germany's global influence, it bought 89.4 billion of dollars of goods from China in 2018 and 57.7 billion dollars of US goods.

Government failures and non-performing loans in European countries: a spatial approach

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Ferdinando Ofria ◽  
Massimo Mucciardi
Keyword(s):  
Public Debt ◽  
Geographically Weighted Regression ◽  
European Countries ◽  
Weighted Regression ◽  
Second Step ◽  
Ols Regression ◽  
Content Type ◽  
The Impact ◽  
The Relationship ◽  
The Eu

PurposeThe purpose is to analyze the spatially varying impacts of corruption and public debt as % of GDP (proxies of government failures) on non-performing loans (NPLs) in European countries; comparing two periods: one prior to the crisis of 2007 and another one after that. The authors first modeled the NPLs with an ordinary lest square (OLS) regression and found clear evidence of spatial instability in the distribution of the residuals. As a second step, the authors utilized the geographically weighted regression (GWR) to explore regional variations in the relationship between NPLs and the proxies of “Government failures”.Design/methodology/approachThe authors first modeled the NPL with an OLS regression and found clear evidence of spatial instability in the distribution of the residuals. As a second step, the author utilized the Geographically Weighted Regression (GWR) (Fotheringham et al., 2002) to explore regional variations in the relationship between NPLs and proxies of “Government failures” (corruption and public debt as % of GDP).FindingsThe results confirm that corruption and public debt as % of GDP, after the crisis of 2007, have affected significantly on NPLs of the EU countries and the following countries neighboring the EU: Switzerland, Iceland, Norway, Montenegro, and Turkey.Originality/valueIn a spatial prospective, unprecedented in the literature, this research focused on the impact of corruption and public debt as % of GDP on NPLs in European countries. The positive correlation, as expected, between public debt and NPLs highlights that fiscal problems in Eurozone countries have led to an important rise of problem loans. The impact of institutional corruption on NPLs reports that the higher the corruption, the higher is the level of NPLs.

Resource access mechanisms in networks and SME survival in Ghana

2018 ◽  
Vol 12 (5) ◽  
pp. 611-631 ◽  
Author(s):  
George Acheampong ◽  
Raphael Odoom ◽  
Thomas Anning-Dorson ◽  
Patrick Amfo Anim
Keyword(s):  
Census Data ◽  
Local Level ◽  
Directed Network ◽  
Resource Access ◽  
Content Type ◽  
Structural Hole ◽  
One Year ◽  
Global And Local ◽  
Access Mechanisms ◽  
Global Influence

Purpose The study aims to determine the resource access mechanism in inter-firm networks that aids SME survival in Ghana. Design/methodology/approach The authors collect census data on a poultry cluster in Ghana and construct a directed network. The network is used to extract direct and indirect ties both incoming and outgoing, as well as estimate the structural holes of the actors. These variables are used to estimate for survival of SMEs after a one-year period using a binary logit model. Findings The study finds that out-indirect ties and structural hole have a significant influence on SME survival. This works through the global influence and the vision advantage that these positions and ties offer the SMEs. Originality/value The study offers SMEs a choice of whom to collaborate with for information (resources) in the form of outgoing and incoming ties at both the global and local level.

Vietnam's debt woes will concern investors

2015 ◽  
Keyword(s):  
Public Debt ◽  
Development Projects ◽  
Foreign Investors ◽  
Content Type ◽  
Borrowing Costs ◽  
Fund Development ◽  
Debt Levels

Subject Vietnam's debt difficulties. Significance Vietnam's Finance Ministry announced on May 15 that it would continue to use offshore borrowings to fund development projects, although many economists caution that public debt levels are unsustainable, potentially harming Vietnam's image with investors. There are concerns that government liabilities may be higher than reported, and that recent monetary initiatives, including currency devaluations, may aggravate the situation. Impacts Borrowing costs will rise, and Vietnam could face a credit downgrade if debt limits are reached. Foreign investors will respond cautiously to reforms of infrastructure partnership regulations. Vietnam's ability to capitalise on ASEAN infrastructure integration may be hindered.

Finland's reforms may end period of stagnation

2016 ◽  
Keyword(s):  
Public Debt ◽  
Growth Potential ◽  
Gdp Growth ◽  
Demographic Trends ◽  
Content Type ◽  
Economic Stagnation ◽  
One Year ◽  
Pension Age ◽  
The Eu

Subject Finland's economy. Significance The Finnish economy contracted from 2012 to 2014 and grew by only 0.5% last year. It has been facing both structural and cyclical headwinds and since 2010 three different governments have been unable to jump-start it. However, the current one-year-old Finnish government has staked much of its political capital on various reforms which are expected to lead to a resumption of growth and a slower increase in public debt. Impacts Due to demographic trends, Finland's long-term growth potential is estimated to be below 2%. Prolonged economic stagnation in the EU and Russia is likely to depress export and GDP growth. The pension age in Finland will increase automatically as life expectancy rises, which may be a model for other European countries.

Slovakia will not change export-led model overnight

2015 ◽  
Keyword(s):  
Public Debt ◽  
Purchasing Power ◽  
External Financing ◽  
Bond Yields ◽  
Content Type ◽  
Breathing Space ◽  
Debt Levels

Significance Impacts The IPO should help cut public debt levels and will create fiscal breathing-space for more spending ahead of the 2016 elections. Falling bond yields will ease debt servicing; Slovakia will comfortably meet its external financing requirement. The deflationary trend will peter out later in 2015 but persistently low inflation will help boost household purchasing power.

Costa Rica's socioeconomic problems will outlast Solis

2016 ◽  
Keyword(s):  
Social Security ◽  
Public Debt ◽  
Tax Reforms ◽  
Municipal Elections ◽  
Content Type ◽  
Lame Duck ◽  
Economic Slowdown ◽  
Socioeconomic Problems

Subject Midway through his term, Solis is a lame duck president. Significance President Luis Guillermo Solis's first two years in power have been largely ineffectual. Opposition in Congress together with divisions in his party and his lack of experience have hindered much-needed reforms in areas such as social security. Strong results for the opposition in February's municipal elections have further limited the government's room for manoeuvre. Impacts Social demands and the economic slowdown will see public debt steadily rise this year. Efforts to introduce tax reforms are unlikely to make it through the divided Congress. Solis's successor will inherit the problems of this administration and may be no better placed to address them.

Desperation will drive Bosnian Serb leader's choices

2015 ◽  
Keyword(s):  
State Level ◽  
The State ◽  
Budget Deficits ◽  
Content Type ◽  
Reform Programme ◽  
20Th Anniversary ◽  
Republika Srpska ◽  
The Eu ◽  
The Imf

Subject The proposed Bosnian Serb referendum on the state-level judiciary. Significance The Serb-dominated entity of Republika Srpska (RS) is proposing a referendum challenging the authority of the Bosnia-Hercegovina (BiH) judiciary and Bosnia's weakened international supervisor, the high representative. The initiative comes amid already heightened tensions relating to the 20th anniversary of the Srebrenica massacre. Such a referendum would challenge Bosnia's territorial and constitutional sovereignty. Impacts A strongly worded US embassy statement on the referendum has warned of possible legal actions against the RS leadership. The EU reaction has been softer, reflecting diverging US-EU views of the seriousness of the problem and how to resolve it. Failing agreement on a reform programme with the IMF, Bosnia's two entities must turn to private lenders to finance budget deficits.

Prospects for the euro-area in 2019

2018 ◽  
Keyword(s):  
Economic Growth ◽  
Economic Policy ◽  
Euro Area ◽  
World Trade ◽  
Content Type ◽  
The Face ◽  
The Eu

Subject Prospects for the euro-area in 2019. Significance The improvement in economic growth registered across most of the EU in 2017 fizzled out in 2018, linked to the stalling of world trade as well as an increase in inflation. Within the EU, individual governments are heading in different economic policy directions as some attempt to meet deficit and debt reduction targets despite voter disapproval while others are pressed by austerity-weary voters into disregarding fiscal targets in the face of high debt.

Oman and Bahrain are the most vulnerable Gulf states

2020 ◽  
Keyword(s):  
Public Sector ◽  
Public Debt ◽  
Medium Term ◽  
Fiscal Deficits ◽  
Content Type ◽  
Gulf States ◽  
Remittance Flows ◽  
Debt Levels

Significance Oman and Bahrain, already struggling with rising public debt levels and high fiscal deficits, are in the most exposed medium-term position. Impacts Governments will seek to avoid cutting expenditure on public-sector salaries. Private businesses will lay off many of their expatriate workers. Gulf economic contractions will significantly reduce global remittance flows.

What debt threshold hampers economic growth in Africa?

2019 ◽  
Vol 19 (1) ◽  
pp. 25-42 ◽  
Author(s):  
Lord Mensah ◽  
Divine Allotey ◽  
Emmanuel Sarpong-Kumankoma ◽  
William Coffie
Keyword(s):  
Economic Growth ◽  
Public Debt ◽  
Developed Countries ◽  
Annual Data ◽  
African Region ◽  
African Countries ◽  
Content Type ◽  
Distributed Models ◽  
The Impact ◽  
Debt Levels

Purpose This paper aims to test whether a debt threshold of public debt has any effect on economic growth in Africa. Design/methodology/approach The authors applied the panel autoregressive distributed models on 38 African countries with annual data from 1970 to 2015. It was established that the threshold and the trajectory of debt has an impact on economic growth. Findings Specifically, the authors found that public debt hampers economic growth when the depth is in the region of 20 to 80 per cent of GDP. Based on debt trajectory, this study established that increasing public debt beyond 50 to 80 per cent of GDP adversely affects economic growth in Africa. The study also finds that the persistent rise in debt also has adverse effect on economic growth in the African countries in the sample. It must be known to policymakers that the threshold of debt in developing countries, and for that matter African countries, are less than that of developed countries. Practical implications This study suggests threshold effects between 20 and 50 per cent; this should be a guide for policymakers in the accumulation of debt stock. Interestingly, the findings suggest some debt trajectory effect, which policymakers might consider by increasing efforts to reduce debt levels when they fall between 50 to 80 per cent of GDP. This implies that reducing such debt levels can help African countries increase their economic growth. Originality/value The study is unique because it seeks to add new evidence on the relationship between public debt and growth in the African region, by considering the impact of the persistent growth of public debt on economic growth.

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