All GLG News Analyses Filed Under: Economics
Analyses are solely the work of the authors and have not been edited or endorsed by GLG.
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Free Trade Agreements and U.S. Companies
August 21, 2008
South Korea and EU Begin Free Trade Talks | news.bbc.co.uk
The U.S. is becoming increasingly protectionist just as the Europeans, previously known for their protectionism, are opening their markets to trade with developing and emerging countries in Asia, Africa, and other regions. This could spark a long-term decline in U.S. prosperity and reduce the ability of U.S. companies to compete internationally as parts of their global supply chains become harder to maintain. With a Democratic Congress and a Democratic Presidential candidate firmly in the pocket of the trade unions, which abhor free trade and never encountered a protectionist measure they didn't like, the American dream may soon become a fond and distant memory.
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Mark SloanPartnerDTB Associates, LLP
The Proliferation of World Wide Free Trade Agreements - What it Means for U.S. Businness
August 18, 2008
South Korea and EU Begin Free Trade Talks | news.bbc.co.uk
While the U.S. Congress may be putting the breaks on the prospect of any future U.S. Free Trade Agreements, non U.S. FTA deals continue to proliferate around the world. Over 400 new FTA's have been notified to the World Trade Organization, three quarters of those since 1997. With the looming failure of the WTO's Doha Trade Round, countries like Brazil have said they will accelerate the pace of FTA negotiations with countries around the world. Given the increasingly complex web of bilateral free trade agreements, it is critical that companies involved in international trade and investment understand the implications of these deals on their trading and investment decisions. In addition to the elimination of import duties, these FTA deals frequently include the simplification or elimination of technical barriers to trade. In the future, companies will need a consolidated and integrated base of tariff and technical information to make smart decisions on sourcing and investment.
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Philippine economy unfazed by dearth of new FDI's due to increasing remittances from its OFW's
July 23, 2008
Rise of the new Filipino middle class | www.atayala.com
The Philippines emerging economy continues to ride out the economic and financial concerns plaguing most developed and developing economies due to the continuing large foreign currency inflows from its OFW's (Overseas Foreign Workers). From last years $14B to this years $15B (and counting) remittances, the country expects to survive increasing interest rates, commodity prices and high inflation. The burgeoning BPO industry is also contributing a significant part to the new emrging local middle class.
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Foreign Investment in Russia Will Continue to Decline, Stephen Blank, US Army War College
July 3, 2008
Foreign investment in Russia shrinks by almost 30% | www.rbcnews.com
Foreign investment in Russia will probably continue to decline. Russia has adopted a stringent new law on foreign investment reserving the really important sectors to the state and there is no sign that the state will either move to a true rule of law, despite Medvedev's statements on the subject, or that key state actors will voluntarily relinquish their ownership of key firms and sectors. Indeed, they apparently are moving to expand their holdings, particularly in energy, defense, and high-tech sectors. Foreign investors will be able to move into the services sector as long as those firms are not espeically important to Russia and need foreign capital. But their legal position and opportunity to repatriate profits will remain as insecure as before and their property rights will be largely conditional and subject to political raids either by police or tax inspectors or some other officials. As Russia embraces autarchy, it will suffer the consequences of that suboptimal policy.
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June 26, 2008
EU approves new sanctions on Iran | www.iht.com
Dealing with the Iranian regime is extremely important since nothing substantive can be accomplished in the Middle East without dealing with Iran.
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June 26, 2008
EU approves new sanctions on Iran | www.iht.com
The article indicates that Europe seeks to placate the outgoing Bush Administration by agreeing to minimal sanctions on Tehran. However, while welcoming the European action, President Bush made it clear that the US insists on Iran's complete halt to nuclear enrichment, which the sanctions agreed-to by Europe will not accomplish. Rather than forestalling unilateral US military action against Iran, the Bush Administration may see dialogue with Europe as "checking a box" on a diplomatic effort before resorting to force.
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June 26, 2008
EU approves new sanctions on Iran | www.iht.com
While EU sanctions are a negative development from Iran's point of view they do not represent the end of the road.We have to recall that such sanctions have never had its intended effects while their negative consequences,mostly unintended,have been pronounced. Politically it will reduce EU's influence as a bridging between US and Iran. Iran 's oil and gas output will ensure that the sanctions will not bite the man in the street. It will give the regime another arrow in its quiver to blame Western nations. All to the good for keeping the moderates in Iran from increasing their support base. While the Iranian banking system will feel the pressure we can expect Iran to direct its exports and source its imports from China,India and ASEAN.At the same time Iran's using Euro for its oil trades will mean greater pressure on banks to parrk its reserves. WE can expect Dubai to fulfill an 'entrepot' role in the aftermath of the EU sanctions
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EU Sanctions on Iran Would Have No Substantial Effect At All
June 25, 2008
EU approves new sanctions on Iran | www.iht.com
It should be clear that Russia holds Europe at ransom, in so far the oil and, particularly, natural gas. Thus, if Russia chose to help Teheran advance Iranian nukes, both, diplomatically and by the know-how, she must obviously assume similar scenario to this: (1) Sanctions would be practically toothless as the money to pay Russia for help with Bushehr nuke plant will come from various other sources and the commercial products from China, India and Russia. (2) Even if the sanctions is partially successful and drive Iran inflation up, it will help Ahmadinejad's government hide its failures behind the sanction. (3) In a worst case scenario a successful US & NATO strike on Iran means enhancing value of Russian oil and the superpower status of Putin’s “managed democracy.” (4) No bombs at all, and Russia still has its fuel multimillion dollar nuclear fuel deal and the promise of a repeat reactor customer in Tehran.
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Israel NOt Bluffing and Iran likely has nuclear program
June 23, 2008
Israeli official says attack on Iran 'unavoidable' | www.msnbc.msn.com
Israeli warnings about attacking Iran are not bluffs. Israel sees Iran as willing to execute its threats to attack Israel or to extend deterrence to terrorists and provide ithem with other material support with which to attack israel. Moreover, talk that Iran does not have a nuclear weapons program is simply fallacious. Such talk misreads the 2007 national intelligence estimate (readers should see Admiral McConnell's testimony of February 2008 which clarifies those misconceptions). Not only does iran have a nuclear weapons project it also has a robust missile and space program that is intrended to generate both conventional missiles power and a lunch vehicle for a future nuclear weapon. To date Iran's diploimacy has been brilliant in stonewalling the West which is plagued by irresoltuion. But as these statements indicate, Iranian calls ofr a seocnd holocaust are taken very seriously in Jerusalem and the recently described israel military exercises show that Israel means business
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Was Mofaz's Sabre-Rattling Simply a Favor for the Russians?
June 9, 2008
Israeli official says attack on Iran 'unavoidable' | www.msnbc.msn.com
Mofaz's statement is about the price of oil, Russian-Israeli and Russian-Iranian relations more than anything else. The connection to the imminent downfall of the current Israeli government and competition for leadership within the Kadima party is secondary.
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