Ten years of Afghan economic growth, reversed in just 12 months: UNDP

UNAMA/Shamsuddin Hamedi
Women and children have been the most impacted by the current humanitarian crisis in Afghanistan.

A year on from the Taliban takeover in Kabul, Afghanistan is gripped by “cascading crises”, including a crippled economy that humanitarian aid alone cannot address, according to a new report from the UN Development Programme (UNDP) on Wednesday.

It says that the already-declining regular economy, as opposed to the black market, lost nearly $5 billion after August 2021 and is reversing “in 12 months what had taken 10 years to accumulate.”

Soaring prices 

The cost of a basket of essentials needed to avoid food poverty has meanwhile risen 35 percent, forcing poorer households to go deeper into debt or sell off assets, just to survive.

Nearly 700,000 jobs have vanished, said UNDP, further threatening a population reeling from impacts of the COVID-19 pandemic, conflict, drought, and war in Ukraine.

“The Afghan people have been relentlessly subjected to extremely difficult circumstances. They have survived numerous challenges in the last 40 years and shown enormous resilience”, the report states, officially entitled, One Year in Review: Afghanistan Since August 2021.

“Yet the last 12 months have brought cascading crises: a humanitarian emergency; massive economic contraction; and the crippling of its banking and financial systems in addition to denying access to secondary education to girls and the restrictions on women’s mobility and participation in the economy”.

‘Strong response’ by UN

The head of UNDP, Achim Steiner, praised the UN’s “strong, coordinated response to the crisis” saying it proved critical in averting a catastrophe last winter.

“Building upon what worked last year including tailored efforts across multiple sectors to improve the livelihoods of more than half a million people, there is a pressing need to support further measures to prevent a deeper crisis.”

“We need to help Afghans cope with the coming winter including through our ABADEI programme which aims to support two million people with livelihood and job opportunities over the next two years – with a focus on particularly vulnerable groups such as women entrepreneurs and young people.”

Expanding connectivity

The report paints a bleak fiscal picture of the country, dating back more than a decade before the Taliban ascendency.

With GDP in steady decline since 2008, Afghanistan had come to rely on international aid to sustain its economy, which accounted for a staggering 75 percent of total Government spending and nearly 40 percent of GDP at the time of transition. But foreign donors largely suspended aid after the transition, UNDP notes.

Without support from outside, Afghanistan must now rely on limited domestic revenue from agriculture and coal exports.

Authorities have sought to address revenue shortfalls by cracking down on corruption in key revenue streams, such as customs, and by reaching out to the private sector and foreign investors.

“Two decades of heavy dependence on international aid and imports, a lack of industrialization and competitiveness, and limited mobility and connectivity among regions, among other factors, have hindered Afghanistan’s forward momentum,” the report says.

Cost of excluding women

UNDP analysis forecasts that restricting women from working can result in an economic loss of up to $1 billion – or up to five percent of the country’s GDP.

“The rights of women and girls are critical for the future of Afghanistan,” said UNDP Asia-Pacific Director Kanni Wignaraja. “It starts with education and continues with equal opportunity when it comes to employment and pay.

“UNDP made the support to women-owned businesses front and center of its aid activities: we provided support to 34,000 women-owned small businesses. Our goal is to reach 50,000 women-owned business by the end of this year.”

UNDP Resident Representative Abdallah Al Dardari said they was grateful for the $300 million in funding provided for the programme’s work on livelihoods as part of the overall crisis response, “but much more is needed for economic recovery”.

“Afghans are running out of time and resources. Afghanistan needs support from the international community to bring back to life local markets and small businesses which are the backbone of Afghanistan’s economy.”

FONTE: https://news.un.org/en/story/2022/10/1129287

Levantamento expõe fragilidade do sistema alimentar a choques de saúde ou clima

^{Stephan Gladieu/Banco MundialDieta que forneça um mínimo de energia suficiente está fora do alcance de mais de 10% da população africana.}

Estudo da FAO destaca lições aprendidas com Covid-19; 3 bilhões de pessoas no mundo não têm acesso a uma dieta saudável, e 1 bilhão a mais podem enfrentar a situação se um novo choque extremo climático ou de saúde reduzir rendas da população em um terço.  

Os países precisam fazer com que os sistemas agrícolas sejam mais resilientes a imprevistos climáticos extremos ou patológicos, como foi o caso da pandemia de Covid-19. 

Um levantamento da Organização das Nações Unidas para Alimentação e Agricultura, FAO, divulgado nesta terça-feira, destaca a importância de um preparo a eventos inesperados e de grande impacto.  

Indicações 

Foto: Banco Mundial/Peter Kapuscinski / Mudança climática afeta também produção agrícola

Este é o foco do relatório O Estado da Alimentação e Agricultura 2021, com ênfase em como tornar os sistemas de produção de alimentos mais resilientes a choques e a estresses. O documento fornece uma série de recomendações aos governos.  

Segundo a agência da ONU, cerca de 3 bilhões de pessoas no mundo não podem custear uma dieta saudável. Se um novo choque acontecer, reduzindo as rendas da população em um terço, é possível que mais 1 bilhão passem a esse patamar.  

Além disso, o custo da comida poderá subir para 845 milhões de pessoas se houver uma desordem nos sistemas de transporte de alimentos. A FAO lembra que mesmo antes da pandemia, o mundo já estava com dificuldades para cumprir as metas de erradicação da fome até 2030.  

Outro destaque é o aumento, em todo o mundo, de eventos climáticos extremos, conflitos armados e imprevistos, que contribuem para o aumento do preço global dos alimentos.  

Brasil  

Pnuma/Lisa MurraySementes são chave para o incremento de 50% na produção agrícola

A FAO reforça ser urgente melhorar a capacidade desse sistema de suportar os choques mencionados no relatório. O Brasil é mencionado no documento, já que 60% dos valores de exportação do país vêm de apenas um país parceiro comercial. Com isso, o Brasil fica com poucas opções se esse parceiro for atingido por um imprevisto.  

O diretor-geral da FAO, Qu Dongyu, declarou que “a pandemia salientou a resiliência e a fraqueza dos sistemas agroalimentares”. Este setor, que envolve a produção de alimentos, armazenamento, processamento, transportes, distribuição e consumo, produz 11 bilhões de toneladas de comida por ano.  

A FAO recomenda aos governos que tornem a resiliência dos sistemas agroalimentares uma parte estratégica dos seus planos de resposta a desafios futuros.  

Outro fator importante é garantir a conectividade, para que os sistemas ultrapassem os imprevistos de maneira rápida, mudando os canais de transportes, marketing e força de trabalho sempre que for necessário.  

Fonte: https://news.un.org/pt/story/2021/11/1771422

Latin America’s Inflation Challenge

Inflation has surged in the largest economies of Latin America, prompting large central banks in the region to raise interest rates before economic activity has fully recovered.

Our latest Regional Economic Outlook shows how rapidly inflation is rising. In the first year of the pandemic, average inflation in Brazil, Chile, Colombia, Mexico, and Peru—the LA5—was below the average for other emerging market economies. It’s now higher, averaging 8 percent year-on-year in October and in the case of Brazil, surpassing 10.5 percent.

Soaring food prices are partly driving the surge. They started increasing even before the pandemic and have risen more than 18 percent on average in LA5 countries since January 2020.

In Latin America, food prices make up about a quarter of the average consumption basket. For households still reeling from the coronavirus crisis, higher food bills leave less to spend on other goods. In a region with the highest levels of income inequality, the burden is highest for low-income households who spend a larger share of their income on food.

Even core inflation, which excludes food and energy prices, has exceeded the pre-pandemic trend this year, reaching an average of 5.9 percent year-on-year in October.

Inflationary pressures should be temporary and medium-term inflation will likely revert to central bank targets. But there is a lot of uncertainty. The shock from the pandemic is unique and its impact on commodity prices, supply bottlenecks, and rising shipping costs is hard to pin down.

The region is also battling a long history of high and unstable inflation—a challenge for central banks that have only recently established their credibility. This history may have led to indexation practices (contracts that adjust their terms automatically with inflation) that could accelerate prices further.

There is also the risk that international financial conditions tighten rapidly and unexpectedly in response to inflation developments in advanced economies, leading to capital outflows. This potential shock could jeopardize financial stability and depreciate currencies in Latin America, adding to inflationary pressures.

Managing expectations, through statements or rate hikes, is a key factor in heading off an inflationary spiral, which is why central banks in the region are moving fast to preserve their hard-won credibility in an uncertain environment. All LA5 countries have already hiked policy rates and their monetary authorities have shifted up forward guidance.

Despite the recent rate hikes, monetary policy stances generally remain accommodative and continue to support the ongoing recovery. The region nevertheless faces difficult trade-offs and needs to balance an uncertain inflation outlook with employment still substantially below pre-pandemic levels and an uneven recovery in Latin America’s jobs market.

Fonte: https://blogs.imf.org/2021/11/16/latin-americas-inflation-challenge/

US economic decline not as bad as feared

The US economy shrank by 3.5% last year faring better than many other countries despite the heavy economic toll caused by the pandemic.

However growth slowed in the last three months of the year, as a resurgence of virus cases prompted a fresh pullback in activity.

Output increased at an annual rate of 4% in the last three months of 2020.

That was slower than many analysts had expected – and down sharply from the rebound seen in the prior quarter.

The overall fall in 2020 reported by the US Commerce Department was the sharpest decline since 1946, when the US was demobilising after World War II. Compared to the fourth quarter of 2019, output was down 2.5%.

But the contraction was not as bad as many had feared in the depths of the lockdowns last spring, when spending on activity like dining and travel plummeted.https://buy.tinypass.com/checkout/template/cacheableShow?aid=tYOkq7qlAI&templateId=OTBYI8Q89QWC&templateVariantId=OTV0YFYSXVQWV&offerId=fakeOfferId&experienceId=EXAWX60BX4NU&iframeId=offer_0e763acc7b457c03340a-0&displayMode=inline&widget=template

And despite soaring unemployment numbers and a sharp increase in poverty, the US was not hit as badly as many other parts of the world.

The International Monetary Fund estimates that the UK economy, for example, shrank by 10% last year, while Canada, Japan and Germany all dropped by more than 5%.

China is the only major economy that has reported growth, with gross domestic product (GDP) up 2.3%.

US economic growth “was still down by 2.5% on a year earlier, but that still represents a much faster recovery than we would initially have expected given how grim things looked in mid-2020,” said Paul Ashworth, chief US economist at Capital Economics.

“With effective vaccines offering the possibility of a return to normalcy later this year and the Biden administration intent on more fiscal stimulus, we think GDP growth will be as high as 6.5% this year.”

Leia a matéria completa em: https://www.bbc.com/news/business-55844807

When will China overtake the US to become the world’s biggest economy

When will China overtake the United States to become the world’s biggest economy? Few questions are more consequential, whether it is for executives wondering where long-term profits will come from, investors weighing the US dollar’s status as global reserve currency, or generals strategising over geopolitical flashpoints.

In Beijing, where they have just been celebrating the 100th anniversary of the Chinese Communist Party, leaders are doing their best to present the baton-change as imminent and inevitable.

“The Chinese nation,” President Xi Jinping said last week, “is marching towards a great rejuvenation at an unstoppable pace.”

Early in the coronavirus crisis, when China managed to control infections and maintain growth even as the US suffered hundreds of thousands of deaths and a crunching recession, many were inclined to agree. More recently, an unexpectedly fast US recovery has illustrated just how much uncertainty remains around the timing of the transition – and even whether it will happen at all.

“The reason I haven’t bought three Rolls Royces is not because the government wouldn’t let me” Chinese netizen

If Xi delivers on growth-boosting reforms, and his US counterpart President Joe Biden is unable to push through his proposals for renewing infrastructure and expanding the workforce, forecasts from Bloomberg Economics suggest China could grab the top spot – held by the US for well over a century – as soon as 2031.

But that outcome is far from guaranteed. China’s reform agenda is already languishing, tariffs and other trade curbs are disrupting access to global markets and advanced technologies, and coronavirus stimulus has lifted debt to record levels.

The nightmare scenario for Xi is that China could follow the same trajectory as Japan, also touted as a potential challenger to the US before it crashed three decades ago. A combination of reform failure, international isolation and financial crisis could halt China before it reaches the top.

Another possibility – enticing to the sceptics – is that if China’s official gross domestic product (GDP) data is exaggerated, the gap between the world’s biggest and second biggest economies may be larger than it appears, and closing at a slower pace.NEWKNOWLEDGEHow does China’s economy impact the world?Get the full picture

Over the long haul, three factors determine an economy’s growth rate. The first is the size of the workforce. The second is the capital stock – everything from factories to transport infrastructure to communication networks. Finally there is productivity, or how effectively those first two can be combined.

In each of these areas, China faces an uncertain future.Start with the workforce. The maths is straightforward – more workers means more growth, and fewer workers means less. Here lies China’s first challenge.

Leia a matéria completa em: https://www.scmp.com/economy/china-economy/article/3140038/when-will-china-overtake-us-become-worlds-biggest-economy

What is ISDS?

Published on Feb 24, 2016

A brief explanation of Investor State Dispute Settlements.

Scripps Howard Foundation Wire

Trade talks and trade wars: How high are the gains and the costs?

Published on Jun 14, 2017

The WTO Trade Dialogues lecture series focuses on the latest research on international trade and globalization.

Ralph Ossa discussed the costs of trade wars and highlighted the benefits of multilateral trade cooperation.

Ralph Ossa is currently Professor of Economics of Globalization and Emerging Markets at the University of Zurich.

World Trade Organization