1 Climate change ‘biggest
threat to global economy in 2016 (Larry Elliott in The Guardian) A catastrophe caused by climate change is seen as the
biggest potential threat to the global economy in 2016, according to a survey
of 750 experts conducted by the World Economic Forum.
The annual assessment of risks conducted by the WEF
before its annual meeting in Davos on 20-23 January showed that global warming
had catapulted its way to the top of the list of concerns.
A failure of climate change mitigation and adaptation was
seen as likely to have a bigger impact than the spread of weapons of mass
destruction, water crises, mass involuntary migration and a severe energy price
shock – the first time in the 11 years of the Global Risks report that the
environment has been in first place.
The WEF said evidence was mounting that inter-connections
between risks were becoming stronger. It cited links between climate change and
involuntary migration or international security, noting that these often had
“major and unpredictable impacts”.
The WEF said the broad range of risks – from
environmental to geopolitical and economic – was unprecedented. It added that
risks appeared to be rising, with global average surface temperatures
increasing by more than 1C over pre-industrial levels for the first time, and
the number of forcibly displaced people at 59.5 million – almost 50% more than
in 1940 when the second world war was being fought.
US shares had fallen over 2% as a oil stockpiles
report and a Federal Reserve survey suggested more sluggish growth. Weak
economic data from Japan also dented investors' confidence. Government data
showed that core machinery orders fell 14.4% in November from the previous
month.
The orders were down for the
first time in three months in the world's third largest economy. Brent crude
prices, meanwhile, fell 0.9% to $30.05 a barrel after earlier hitting a fresh
12-year low of $29.73.
Australia's S&P/ASX 200 share index ended 1.6% lower
at 4,909.40, despite the release of better than expected employment data. The
unemployment rate in the country was 5.8% in December, with fewer jobs lost
than economists were expecting. The country lost 1,000 new jobs, as against
expectations of 10,000.
3 South Korea growth outlook trimmed to 3% (San
Francisco Chronicle) South Korea's central bank
trimmed its growth forecast for the country's economy on Thursday, citing the
instability in Chinese markets.
The Bank of
Korea predicted that Asia's
fourth-largest economy will grow 3.0 percent this year, down from an earlier
estimate of 3.2 percent. Bank of Korea Gov. Lee Ju-yeol said the volatility in
Chinese financial markets and a sharp drop in the South Korean currency were
behind the revision.
The central bank
said a recovery in consumer spending could be limited by the phase-out in
consumption tax cuts and slowing sales of housing markets. Private capital
spending will likely see slower growth due to uncertainties at home and abroad,
it added.
The bank's
outlook is more optimistic than private economic research centers but is
broadly in line with the financial ministry's forecast. Still, its downward
revision is the latest reminder that the once dynamic Asian economy is losing
steam.
South Korean manufacturing
companies that used to fuel growth and development of the country with exports
of ships, cars, steel, televisions and memory chips are quickly losing edge,
coming under threats from Chinese companies. Exports last year dropped 8
percent from a year earlier. The country's trade ministry said exports will
recovery slightly this year, gaining 2 percent from last year.
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