International Headlines: Economy
Renewables Scrutinized as Oil Prices Falls Financial Times
September 7, 2015
With the plunge in the price of crude oil from $115 a barrel last summer to less than $50, there are worries that as oil and natural gas become cheaper, they could undermine investment in renewables and slow the development of more environmentally friendly energy sources. A study by Bloomberg New Energy Finance, the global power generation mix will change radically by 2040, from a system comprising two-thirds fossil fuels to one where 56 per cent of energy comes from sources creating zero carbon emissions.
Several companies have made investments in solar and wind power, such as US private equity group KKR which has acquired significant portions of Gestamp, a Spanish solar developer. However, for some small island nations and large parts of Africa, where unreliable electricity supplies mean high dependence on diesel and other fuel oil for generators, a leap to renewables now appears less likely.
Brazil’s Real Hits Two-Decade Low
Wall Street Journal
September 23, 2015
Brazil’s currency hit its lowest level against the dollar in two decades as investors wagered that the drop in commodity markets and political difficulties would continue to batter the country’s economy. The real lost 35% of its value against the dollar this year. The number of investors that wagered Brazil would default on its debt is the 2nd highest after Italy. Given its high dependence on commodity exports to China, Brazil was deeply impacted by the slowdown in China’s economy.
Ministers to Reconvene TPP Talks in Late September
Japan Times
September 17, 2015
A meeting of chief negotiators from the United States, Japan, Canada and nine other member countries involved in the U.S.-led Trans-Pacific Partnership talks will begin on September 26, followed by a two-day meeting of ministers on September 30. Negotiators see the need for striking a deal ahead of the October 19 general election in Canada, and before the national focus in the United States shifts later this year to the 2016 presidential election. These two events will make it increasingly hard for politicians there to concentrate on the TPP. Ministers from the twelve countries failed to reach a broad agreement on the initiative during talks in Hawaii in late July. The United States, Japan, Canada and Mexico held a series of meetings on TPP-related issues such as automotive trade last week in Washington. The four countries, however, failed to see a clear path to concluding the overall TPP talks anytime soon.
Ecuador Is The World's First Country With A Public Digital Cash System
Fast Company
August 10, 2015
While the success of mobile money products like M-Pesa, which first took off in Kenya, has inspired dozens of copycats around world, the Ecuadorian government is experimenting something different with its Sistema de Dinero Electrónico (Electronic Money System). Under the program, anyone can walk into a participating bank and exchange their cash for electronic money that is stored on their phone. They can then use it to make payments to other people or to buy goods and services. Launched in February, 47,800 people have used the system. So far twelve banks, both public and private, are converting cash, with more expected to come on board in the next six months. The government plans to raise the fees it pays banks for cooperating.
Manufacturing Hub Starts Work on First Zero-labor Factory
Solidarity Economy
A manufacturer in southern China's Guangdong province has begun construction of the city's first zero-labor factory. Dongguan-based private company Everwin Precision Technology Ltd. is pushing toward putting 1,000 robots in use in its first phase of the zero-labor project. The company has already put 100 robots on the assembly line. After the work on the smart factory started, Chen Qixing, the company's board chairman, predicted that instead of 2,000 workers, the current strength of the workforce, the company will require only 200 to operate software system and backstage management. Manufacturers like these in the Pearl River Delta have been hit by a shortage of an estimated 600,000 to 800,000 workers, according to data released in February. Tens of thousands of migrant workers went back home for a family get-together and some decided to settle down in their hometown where living costs are much less than coastal cities. The country also faces increasingly aging migrant workers. Although the number of migrant workers in China continued to grow in 2014, the rate of increase for the group has fallen consecutively for four years, and their average age is on the rise. Around 43.5% of migrants in 2014 were over 40 years old, compared to 34.1% in 2010, and 30% in 2008, government data show. Guangdong authorities said in March that they will invest 943 billion yuan ($152 billion) to replace humans with robots within three years. The local government will push for robots in 1,950 companies across the province and plans to build two advanced industrial bases for robot production by the end of 2017.