Lower welfare spending may curtail Brazil recovery

2021 ◽  
Keyword(s):  
Exchange Rate ◽  
Sharp Increase ◽  
Industrial Sector ◽  
Economic Effects ◽  
Economic Recovery ◽  
Content Type ◽  
Welfare Spending ◽  
Poverty And Inequality

Significance The economic effects were immediate: a sharp outflow of portfolio capital, which generated exchange rate devaluation of 27.3% in three months; a contraction in GDP, driven down by services and the industrial sector and particularly evident in the second quarter; and a sharp increase in unemployment, which reached 14.4% in August 2020. Impacts Conflicting pressures between welfare spending and fiscal rectitude will mount in coming months. Poverty and inequality will again begin to rise. Reduced crisis-related spending may slow economic recovery this year.

Nigeria's poorly performing economy could tip election

2018 ◽  
Keyword(s):  
Economic Development ◽  
Exchange Rate ◽  
Political Parties ◽  
Private Sector ◽  
Democratic Party ◽  
Presidential Elections ◽  
Economic Recovery ◽  
Content Type ◽  
Strong Performance ◽  
International Investors

Subject Nigerian economic platforms. Significance The two main political parties in the 2019 presidential elections have released their campaign manifestos, both focused on similar themes of economic development and jobs creation. The governing All Progressives Congress (APC) envisages an expanded role for government in driving the economy while the opposition People’s Democratic Party (PDP) has outlined a private sector-led framework. Neither approach is likely to achieve their vast promises. Impacts The exchange rate is unlikely to be fully liberalised regardless of who triumphs. International investors have largely written off the chances of a full economic recovery if Buhari wins a second term. Abubakar's previous political flip-flops could sow doubts over his commitment to market-based reforms. A strong performance by technocratic candidates could signal growing voter appetite for change beyond the established parties.

Chinese demand will drive Brazil beef price rises

2020 ◽  
Keyword(s):  
Exchange Rate ◽  
Sharp Increase ◽  
African Swine Fever ◽  
Food Prices ◽  
Domestic Consumption ◽  
Content Type ◽  
Pork Production ◽  
Domestic Prices ◽  
Beef Prices ◽  
Exchange Rate Depreciation

Significance From late October to late November 2019, beef prices in Brazil increased, on average, by 35%, with the price of fattened cattle reaching over 230 reais (approximately 55 dollars) per 15 kilograms at the peak. Much of the sharp increase was due to rising Chinese demand for Brazilian beef after an African swine fever epidemic reduced Chinese pork production by over 30%. Exchange rate depreciation, domestic consumption and supply constraints have also contributed to lift domestic prices. Impacts Chinese efforts to reduce prices may hit beef exporters who have invested in infrastructure to meet Chinese demand. There is no risk of a beef shortage in Brazil, but prices are likely to remain high at least temporarily. Consumer shifts to alternative meats could also boost a range of food prices, hitting purchasing power.

Remittance decline will further sap Yemeni resilience

2020 ◽  
Keyword(s):  
Exchange Rate ◽  
Rural Areas ◽  
Small Scale ◽  
Policy Changes ◽  
Donor Funding ◽  
Content Type ◽  
Policy Responses ◽  
Poverty And Inequality ◽  
Gulf States

Significance A significant contributing factor is likely a sustained decline in remittances from workers in Gulf states, related to long-term policy changes as well as recent pandemic policy responses. This coincides with a dramatic drop in humanitarian donor funding, putting further pressure on the exchange rate. In addition, the war is ongoing, COVID-19 and other diseases are spreading and the whole country has now been hit by devastating rains and floods. Impacts Hunger could become significantly more widespread, although agencies may lack the data to define this as famine. The decline in remittances will especially impact the small-scale private sector of shops and microenterprises. Increased poverty and inequality could worsen community-level instability, particularly in rural areas. Yemenis’ perceptions of Saudi Arabia could become even more negative, despite ongoing economic and political dependence.

Costa Rica’s economy looks set for a strong recovery

2021 ◽  
Keyword(s):  
United States ◽  
Exchange Rate ◽  
High Frequency ◽  
The United States ◽  
Economic Recovery ◽  
High Frequency Data ◽  
Frequency Data ◽  
Short Term ◽  
Content Type ◽  
Credit Quality

Significance GDP posted growth of 9.4% year-on-year in the second quarter, the highest rate in 23 years. According to high-frequency data, economic recovery appears to have continued between July and September albeit at a slightly slower pace. Impacts Low inflation will allow the Central Bank to maintain an accommodative stance in the short term; any rate hikes next year will be gradual. Banks’ profitability and credit quality may deteriorate in 2022 as loan restructuring measures expire and lagged pandemic effects kick in. The exchange rate may further depreciate amid uncertainty over the country’s fiscal prospects and the outcome of the 2022 elections. While tourism appears to be on a strong trajectory, the spread of Omicron in Europe and the United States could reverse its recovery.

Islamic hedging for pilgrimage funds: case of Indonesia

2019 ◽  
Vol 11 (3) ◽  
pp. 328-341
Author(s):  
Rifki Ismal ◽  
Nurul Izzati Septiana
Keyword(s):  
Exchange Rate ◽  
The Other ◽  
Exchange Rate Risk ◽  
Content Type ◽  
Other Hand ◽  
Rate Risk ◽  
Risk Identify ◽  
Hajj Season ◽  
The Right ◽  
Very High

Purpose The demand for Saudi Arabian real (SAR) is very high in the pilgrimage (hajj) season while the authority, unfortunately, does not hedge the hajj funds. As such, the hajj funds are potentially exposed to exchange rate risk, which can impact the value of hajj funds and generate extra cost to the pilgrims. The purpose of this paper is to conduct simulations of Islamic hedging for pilgrimage funds to: mitigate and minimize exchange rate risk, identify and recommend the ideal time, amount and tenors of Islamic hedging for hajj funds, estimate cost saving by pursuing Islamic hedging and propose technical and general recommendations for the authority. Design/methodology/approach Forward transaction mechanism is adopted to compute Islamic forward between SAR and Rupiah (Indonesian currency) or IDR. Findings – based on simulations, the paper finds that: the longer the Islamic hedging tenors, the better is the result of Islamic hedging, the decreasing of IDR/USD is the right time to hedge the hajj funds and, on the other hand, the IDR/SAR appreciation is not the right time to hedge the hajj funds. Findings Based on simulations, the paper finds that: the longer the Islamic hedging tenors, the better is the result of Islamic hedging, the decreasing of IDR/USD is the right time to hedge the hajj funds and, on the other hand, the IDR/SAR appreciation is not the right time to hedge the hajj funds. Research limitations/implications The research suggests the authority to (and not to) hedge the hajj fund, depending on economic conditions and market indicators. Even though the assessment is for the Indonesian case, other countries maintaining hajj funds might also learn from this paper. Originality/value To the best of author’s knowledge, this is the first paper in Indonesia that attempts to simulate the optimal hedging of hajj funds.

Impacts of high-speed railway on the industrial pollution emissions in China

Kybernetes ◽  
2020 ◽  
Vol 49 (11) ◽  
pp. 2713-2735 ◽  
Author(s):  
Xiaomin Fan ◽  
Yingzhi Xu ◽  
Yongqing Nan ◽  
Baoli Li ◽  
Haiya Cai
Keyword(s):  
Environmental Effects ◽  
Industrial Pollution ◽  
High Speed ◽  
Assessment Method ◽  
Economic Effects ◽  
High Speed Railway ◽  
Central Cities ◽  
Content Type ◽  
Pollution Emissions ◽  
The Impact

Purpose The purpose of this paper is to analyse the impact of high-speed railway (HSR) on industrial pollution emissions using the data for 285 prefecture-level cities in China from 2004 to 2016. Design/methodology/approach The research method used in this paper is the multi-period difference-in-differences (DID) model, which is an effective policy effect assessment method. To further address the issue of endogeneity, the DID integrated with the propensity score matching (PSM-DID) approach is employed to eliminate the potential self-selection bias. Findings The results show that the HSR has significantly reduced industrial pollution emissions, which is validated by several robustness tests. Compared with peripheral cities, HSR exerts a greater impact on industrial pollution emissions in central cities. In addition, the mechanism test reveals that the optimised allocation of inter-city industries is an important channel for HSR to mitigate industrial pollution emissions, and this is closely related to the location of HSR stations. Originality/value Previous studies have paid more attention to evaluating the economic effects of HSR, however, most of these studies overlook its environmental effects. Consequently, the impact of HSR on industrial pollution emissions is led by using multi-period DID models in this paper, in which the environmental effects are measured. The results of this paper can provide a reference for the pollution reduction policies and also the coordinated development of economic growth and environmental quality.

Technology revolutions and social development

2005 ◽  
Vol 32 (5) ◽  
pp. 454-482 ◽  
Author(s):  
Peter L. Daniels
Keyword(s):  
Energy Saving ◽  
Well Being ◽  
Economic Effects ◽  
Production Factor ◽  
Human Welfare ◽  
Content Type ◽  
Energy And Environment ◽  
Socioeconomic System ◽  
Trade Competitiveness ◽  
Development Approach

PurposeAims to assess the potential for a broad “green” technoeconomic paradigm (TEP) to effectively achieve and sustain higher levels of welfare from economic and environmental sources in manylower income countries (LIC). A green TEP comprises a new socioeconomic system based upon a set of inter‐related technologies that increase human welfare, but focus upon saving material, energy and other environmental resources. TEPs have pervasive social and economic effects that include substantial productivity, trade competitiveness, and environmental quality advantages. The desirability of such economic change must incorporate the general approach of social economics and alternative notions of well‐being.Design/methodology/approachThe paper is largely discursive in nature and provides a systematic identification of the LIC conditions that are likely to promote, and benefit from, the pervasive adoption of material‐ and energy‐saving technologies. Some results of an exploratory cross‐country study of the empirical link between technology capability and the human development index (HDI) are utilized in the discussion.FindingsThe paper concludes that a green TEP may well provide a viable alternative development approach in the LICs. The main advantages are derived from related resource efficiency gains and reductions in the socioeconomic metabolism, and the benefits of a relative production factor shift toward labor (and away from materials, energy, and environment‐intensive capital). The potential for LICs is also facilitated by the positive spillovers and decreasing cost of green TEP‐related knowledge and technology diffusion in the expanding, decentralizing global communication network. The higher income nations would need to play a significant role in this process.Originality/valueEcological modernisation and material and energy‐saving technologies are widely viewed as essential for achieving long‐term economic and social well‐being improvements in the twenty‐first century and beyond. Discussion of this promising approach typically assumes that this transformation is only viable in the technological and economic context of the higher income nations. However, this paper provides a detailed case for the strategic encouragement and adoption of a green TEP for sustainable economic development and environmental conditions in LICs.

Reducing transportation emissions

2016 ◽  
Vol 23 (3) ◽  
pp. 674-703 ◽  
Author(s):  
Henrik Pålsson ◽  
Ola Johansson
Keyword(s):  
Service Providers ◽  
Freight Transportation ◽  
Industrial Sector ◽  
Content Type ◽  
Logistics Service Providers ◽  
Minor Influence ◽  
Transportation Emissions ◽  
Reduce Emissions ◽  
The Impact ◽  
Practical Implications

Purpose – The purpose of this paper is to examine the intention of companies to reduce transportation emissions by 2020 and the barriers and the discriminating factors that affect the reduction. Design/methodology/approach – A literature review identified potential logistical and technical actions and their barriers, and discriminating factors for reducing transportation emissions. A survey of freight transport-intensive industries in Sweden examined the effects of, intention for implementation of and barriers to 12 actions to reduce CO2 emissions from freight transportation. In total, 172 logistics managers responded, representing a response rate of 40.3 per cent. Findings – Logistics service providers (LSPs) and freight owners are likely to reduce a considerable amount of CO2 emissions from freight transportation by 2020 using a combination of actions. The lowest level of confidence was for reducing CO2 emissions by changing logistics structures, while there was greater confidence by means of operational changes. The actions have few barriers, but there is often a combination of barriers to overcome. Three discriminating factors influence the intention of a firm to reduce transportation emissions: perceived potential, company size and LSP/freight owner. The industrial sector of a freight owner has minor influence. Companies that are particularly likely to reduce emissions are LSPs, large companies, and those that perceive a large reduction potential. Research limitations/implications – Logistical and technical barriers appear to hinder companies from implementing actions, while organisational barriers and external prerequisites do not. Barriers cannot be used to predict companies’ intentions to reduce transportation emissions. The authors examined the impact of three discriminating factors on reduction of transportation emissions. The research is based on perceptions of well-informed managers and on companies in Sweden. Practical implications – The findings can be used by managers to identify firms for benchmarking initiatives and emissions-reducing strategies. Originality/value – The study provides insights into intended CO2 reductions in transportation by 2020. It presents new knowledge regarding barriers and discriminating factors for implementing actions to reduce transportation emissions.

Macroeconomic fundamentals and dynamics of the Indian rupee-dollar exchange rate

2015 ◽  
Vol 7 (4) ◽  
pp. 301-326 ◽  
Author(s):  
Chandan Sharma ◽  
Rajat Setia
Keyword(s):  
Exchange Rate ◽  
Structural Break ◽  
Cointegration Analysis ◽  
Least Square ◽  
Dollar Exchange Rate ◽  
Content Type ◽  
Macroeconomic Variables ◽  
Indian Rupee ◽  
Macroeconomic Fundamentals ◽  
The Impact

Purpose – This paper aims to examine the relationship between Indian rupee-US dollar exchange rate and the macroeconomic fundamentals for the post-economic reform period. Design/methodology/approach – The authors have used an empirical model which includes a range of important macroeconomic variables based on the basic monetary theories of exchange rate determination. At the first stage of the analysis, they have tested structural break in the data. Subsequently, they have employed the fully modified ordinary least square, Wald’s coefficient restriction and impulse response functions (IRF) to estimate the monetary model in the long- and short-run horizons. Findings – Results of analyses indicate that the macroeconomic fundamentals determine exchange rate in a significant way, but their effect varies sizably across the periods. The IRF illustrate the importance of interest rate in controlling exchange rate volatility. Practical implications – The analysis of the behavior of inter-relationship among macroeconomic variables will help policymakers in a deep-rooted understanding of this complex and time-varying relationship. Originality/value – Most of the existing studies have tested the impact of a single or a few macroeconomic fundamentals on exchange rate. But in the present study, we have tested the impact of a range of important variables, i.e. money supply, real income or output, price level and trade balance. Further, considering the importance of structural breaks in data, they authors have employed standard tests of structural break and incorporated the issue in the cointegration analysis.

Exploring the relationship between macroeconomic indicators and sovereign credit default swap in Pakistan

2017 ◽  
Vol 18 (4) ◽  
pp. 368-380
Author(s):  
Abdul Rashid ◽  
Farooq Ahmad ◽  
Ammara Yasmin
Keyword(s):  
Exchange Rate ◽  
Credit Default Swap ◽  
Content Type ◽  
Macroeconomic Variables ◽  
Long Run ◽  
Credit Default ◽  
Macroeconomic Indicators ◽  
Short Run ◽  
The Exchange Rate ◽  
The Interest Rate

Purpose This paper aims to empirically examine the long- and short-run relationship between macroeconomic indicators (exchange rates, interest rates, exports, imports, foreign reserves and the rate of inflation) and sovereign credit default swap (SCDS) spreads for Pakistan. Design/methodology/approach The authors apply the autoregressive distributed lag (ARDL) model to explore the level relationship between the macroeconomic variables and SCDS spreads. The error correction model is estimated to examine the short-run effects of the underlying macroeconomic variables on SCDS spreads. Finally, the long-run estimates are obtained in the ARDL framework. The study uses monthly data covering the period January 2001-February 2015. Findings The results indicate that there is a significant long-run relationship between the macroeconomic indicators and SCDS spreads. The estimated long-run coefficients reveal that both the interest rate and foreign exchange reserves are significantly and negatively, whereas imports and the rate of inflation are positively related to SCDS spreads. Yet, the results suggest that the exchange rate and exports do not have any significant long-run impact on SCDS spreads. The findings regarding the short-run relationship indicate that the exchange rate, imports and the rate of inflation are positively, whereas the interest rate and exports are negatively related to SCDS spreads. Practical implications The results suggest that State Bank of Pakistan should design monetary and foreign exchange rate polices to minimize unwanted variations in the exchange rate to reduce SCDS spreads. The results also suggest that it is incumbent to Pakistan Government to improve the balance of payments to reduce SCDS spreads. The findings also suggest that the inflation targeting policy can also help in reducing SCDS spreads. Originality/value This is the first study to examine the empirical determinants of SCDS spreads for Pakistan. Second, it estimates the short- and long-run effects in the ARDL framework. Third, it considers both internal and external empirical determinants of SCDS spreads.

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