1 Global
trade to gain speed in 2014 (Andrew Walker on BBC) The growth of global commerce will pick up speed
this year and next, says the World Trade Organization. Trade will grow by a "modest" 4.7% this year
and by 5.3% in 2015, says the WTO. Next year's figure, if correct, would be in
line with the average growth rate in world trade over the last 20 years. These
forecasts are consistent with other figures that show the world economy is
gradually recovering from the financial crisis.
In 2009, trade in goods declined by 12% and bounced back
by 14% the following year. The year 2011 was in line with the long term
average, then came what the WTO calls a two-year slump - annual growth of
around 2%. The overall impact is that global trade is above its pre-crisis
level, but well below where it would have been, had it grown in line with the
earlier pre-crisis trend.
But if world trade and its growth before 2008 was in some sense normal,
we are still not back there. But perhaps that isn't normal any more. The
agency's director general, Roberto Azevedo, said that just waiting for an
automatic increase in trade was not enough. He called for new trade
liberalisation agreements, in particular the negotiations known as the Doha
Round.
The new WTO figures confirm that China is now the biggest goods
trader in the world. Adding together exports and imports, China leads the US,
which is itself still the biggest trader in commercial services. However, the
picture is different if the European Union is treated as a single unit,
counting the trade of EU member states with outside nations and excluding
commerce within the Union. On that basis, the EU is the world's biggest trader.
2 Facebook may launch e-money transfer in Europe (Samuel Gibbs
in The Guardian) Facebook is preparing a money
transfer service in Europe that
would allow it to compete with the likes of Western Union, while giving users
the option of storing money with the social network or buying items online. The
US tech firm is seeking regulatory approval in its European base in Ireland for "e-money" status, which
would see it issue digital credits that can be converted into cash by
recipients.
The firm already has permission
for some forms of money transfer in the US, which allow payments within apps,
from which Facebook takes a 30% cut. The company facilitated $2.1bn in
transactions across Facebook in 2013, primarily to games publishers. Approval
in Ireland would allow Facebook to operate an e-money service throughout Europe
using "passporting", which allows digital payments to be used across
EU member states without having to gain regulatory approval from each one.
Facebook declined to comment on
the development. "The market for money transfer is very, very large,"
said Taavet Hinrikus, co-founder of TransferWise – one of three payment
services reportedly in partnership discussions with Facebook. Hinrikus declined
to comment on the reported partnership discussions but said: "For
remittance alone the market is worth around $500bn, according to the World
Bank, but for money moved between developed nations, as well as between
developed and developing individuals and business, the market is valued at an
estimated $5tn to $10tn, based on our analysis of global money flow data."
3 Aussies hope to retire at 70 (Lisa Visentin &
Gareth Hutchens in Sydney Morning Herald) Australians
will become some of the oldest workers in the world if the government lifts the
pension age to 70. Data from the Organisation for Economic Co-Operation and
Development shows if Australia lifts the pension age to 70 – as
indicated by Federal Treasurer Joe Hockey – it will be doing so years
before other countries finish lifting theirs to 67.
Mr Hockey gave his clearest signal yet that Australia’s pension age could rise to 70 in the budget, saying his generation would have to work for longer to prevent serious future budgetary stresses from an ageing population. His plan has been heavily criticised by seniors and the Labor Party, with opposition spokeswoman for families Jenny Macklin saying the legislated rise to 67 had not begun yet, and the government would need to account for serious age discrimination in the workplace before lifting it to 70.
But the Productivity Commission and the Grattan Institute both support
lifting the age to 70, saying it is reasonable in the face of an ageing
population. The data shows if Australia moved to lift its pension age to 70
after 2023, it would be doing so before most other countries had finished
lifting their pension age to 67. Canada will finish lifting its pension age to
67 by 2029; Germany will complete the process by 2029, while the US will be
done by 2036. China has no plans to lift it above 60.
4 Poor education and India's jobs crisis (Raymond Zhong & Saptarishi Dutta in The
Wall Street Journal) India’s economic slowdown is
giving rural Indians fewer incentives to leave their home villages and farms in
search of better-paying work. For some who have already left, it means going
back to a way of life they thought they’d left behind. Credit-rating firm
Crisil predicts that by 2019, 12 million more people will be working in
agriculture than in 2012. Compare this to what happened between 2005 and 2012,
when the agricultural workforce shrank by 37 million people, and you get some
sense of what a turnaround this could represent for India if Crisil’s forecast
bears out.
This stalling of urbanization and industrialization touches on
many aspects of India’s extraordinary, if rickety, economic rise. Part of the
problem is the country’s undersized manufacturing sector. But it’s important
not to undervalue another factor that is also preventing more people in India’s
countryside from finding more productive—and hence more remunerative—work.
School education in India is "abysmally poor" as one
report put it last year. More boys and girls are enrolling than before, but
quality hasn’t kept up. The Right to Education Act, 2009 guarantees free and
compulsory elementary education but has been criticized for setting such
unrealistically high standards for quality that schools are encouraged to pay
bribes in exchange for certifications from government inspectors.
Rabindranath Tagore, the Nobel Prize-winning Bengali poet and
polymath, issued this diagnosis many decades ago: “In my view the imposing
tower of misery which today rests on the heart of India has its sole foundation
in the absence of education.” According to a 2010 study, only 40% of 8- to
11-year-old students in government schools in Bihar could read a simple
paragraph. Just 43% of them could subtract a two-digit number from another
two-digit number. The truly depressing thing about that last statistic? The
nationwide average in India was also 43%.
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