Mongolia eyes e-commerce to diversify its economy
Mongolia is looking to e-commerce to help overcome geographical challenges and diversify its economy, which relies heavily on mining – mainly of copper, coal, iron ores and gold.
The Mountainous, landlocked nation is one of the world’s most sparsely populated. Mongolia’s remoteness, combined with its rugged terrain can make traditional trade and economic activities challenging.
“The Digital way opens up a whole new facet for all aspects of economic diversification and especially trade,” said Tapan Mishra, the UN Resident Coordinator in Mongolia.
“It is extremely important for Mongolia to leverage its trade potential by being eTrade ready,” Mr. Tapan said.
UNCTAD has worked closely with the government on an eTrade Readiness Assessment of the country.
Published on 8 June, it provides insight on the progress that the Eastern Asian nation has made in laying the groundwork for a strong e-commerce ecosystem and offers a road map of action to overcome remaining challenges.
China opens a new era of proactive easing
A Central bank move in Beijing this week is being seen by economists as a starting gun on a new era of monetary policy as China’s Covid-19 reopening fails to gather pace.
On Tuesday, the People’s Bank of China cut its seven-day reverse repurchase rate from 2 percent to 1.9 percent — the such first cut in nine months — as the economy loses momentum and hard data starts to disappoint. Top China economists at Wall Street banks viewed the move as the start of much more easing to come.
“This is the first cut since August 2022, and confirms further that policymakers have switched to proactive easing from wait-and-see,” Citi economists, led by Xiangrong Yu, said in a Tuesday research note shortly after the PBOC’s announcement.
“Our Thesis of timely easing is playing out, and more measures of small steps that don’t have a high threshold could follow in coming weeks,” they said, adding that the upcoming July Politburo meeting in Beijing would be closely watched for more significant measures to follow.
India’s growth is set to power ahead
India’s growth is looking like a “bright spot” as the country’s outsourcing sector remains robust on top of an increasing trend of tech companies moving their manufacturing lines to the country, according to the CEO of Destination Wealth Management.
“India looks like a bright spot in particular because you’re seeing tech companies starting to move forward in terms of manufacturing in India,” said Michael Yoshikami of the wealth management firm, who said he’s expecting an economic growth of 5 percent to 6 percent in the next five years.
The International Monetary Fund recently released its forecast for India’s economy to expand by 5.9 percent in 2023.
A Large part of this is driven by India’s outsourcing sector being on pace to keep its momentum, said the CEO.
Many Companies are opting to outsource software development projects to India for quality at reasonable costs, according to Krina Mehta, a co-founder of U.S.-based offshore software development company Fortune Infosys.
The Country’s “outsource phenomenon” is going to continue, Yoshikami said, attributing it to its assembly of technology schools and companies exercising cost control as a priority.
He said India’s labor costs are also well below many other countries, especially when compared to China’s rising wages.
“China used to be cheap outsource. It’s just not cheap outsource anymore,” Yoshikami said.
“I think you’re going to continue to see an outsource away from China and other countries, maybe Philippines and Vietnam … to India.”
Unlocking Indonesia’s potential through a blue economy
Covid-19 sent shockwaves through economies worldwide, causing severe disruptions and exposing the fragility of growth-oriented models. The pandemic’s impact has forced governments, policymakers, and economists to re-evaluate the traditional approach of focusing solely on economic expansion and imagine alternative economic models.
For Indonesia, this opportunity to reimagine the post-Covid economy is centred around implementing a blue economy.
A Blue economy aims to reset inclusive and long-lasting economic growth by harnessing sustainable marine resources. Growth is achieved through economic interventions that support development while preserving and protecting marine resources.
Indonesia has more than 17,500 islands, 108,000 kilometres of coastline, and three-quarters of its territory at sea. Oceans are central to Indonesia’s prosperity through economic activities such as capture fisheries, aquaculture, coastal tourism, marine conÂstruction and transportation.
Indonesia has the world’s second largest fishery sector, worth around US$27 billion and providing seven million jobs and over 50 percent of the country’s animal-based protein needs. Oceans are a key asset for the country’s tourism industry, which was worth around US$21 billion to gross domestic product (GDP) in 2019.
Indonesia’s unique reliance on the ocean for its economic and cultural development has led its government to adopt the recommendations of the United Nations Environment Programme to promote a low-carbon economy.
This Agreement involves adopting policies and implementing initiatives supportive of a low-carbon economy, prioritising clean water access, mitigating climate change, protecting marine resources, and preserving terrestrial ecosystems.
Japan’s economic security awakening
As the EU Commission is preparing its own economic security strategy, Japan has started to implement its own economic security policies, walking the increasingly tense tightrope between China and the US.
During last month’s G7 summit in Hiroshima, economic security was high up on the agenda, with Europeans, Japan, the US, and Canada wrangling over the exact wording on how to “de-risk” away from China.
It was fitting that this debate took place in Japan, where economic security policies are being rolled out as Europeans are still contemplating them.
Malaysia wants Google, Microsoft to follow Tesla, Amazon’s lead and invest
Malaysia is trying to attract as many technology companies as it can, including Alphabet Inc.’s Google, in its bid to become a major data hub and neutral supply chain base. Photo: dpa
Malaysia wants to lure Microsoft Corp. and Alphabet Inc.’s Google in its drive to be a data hub and as it positions itself as a neutral supply chain base amid rising US-China tensions, according to Trade Minister Zafrul Abdul Aziz.
“We are attracting as many as we can,” and “slowly establishing ourselves” as a data centre hub, Zafrul said in an interview on Friday.
Malaysia’s investment success this year includes attracting companies such as Tesla Inc. and Amazon Web Services. Tesla plans to import its electric vehicles into the Southeast Asian nation and build a network of superchargers, while AWS will invest 25.5 billion ringgit (US$6 billion) in cloud-computing infrastructure by 2037.
Simmering tensions between Washington and Beijing are increasingly pushing global businesses to seek locations outside China. Malaysia is vying with other Southeast Asian countries such as Vietnam and Thailand for investments that are aimed at building new supply chains.
Economic emphasis: on India-Nepal ties
Few Countries have more intimate relations than Nepal with India as they share an open border that allows their nationals to move freely. Their relationship is characterised by close economic, security and cultural ties. India remains a major trade and transit partner, where a number of Nepalis continue to earn a living or pursue higher education. Good ties with Nepal, meanwhile, help India address security and geopolitical issues in its neighbourhood more smoothly. Yet, their political relationship, in the near past, has gone through more ebbs than flows, largely due to a border dispute over the Kalapani area.
Philippine economic managers retain 6-7pc gdp growth forecast for 2023
A Top Philippine government official recently said economic managers have retained the 6-7 percent economic growth forecast for 2023 and 6.5-8 percent assumption for 2024 to 2028, taking into account both domestic and external risks.
The Risks include those posed by El Nino and other natural disasters, global trade tensions and value chain disruptions, the country’s budget and management secretary Amenah Pangandaman, who also heads the inter-agency Development Budget Coordination Committee (DBCC), said in a briefing last week.
The Philippine economy grew by 6.4 percent in the first quarter this year, faster than other developing and emerging economies, such as Indonesia, China and Vietnam.
Singapore’s economy set to slow, as Hong Kong roars back to life: survey
Hong Kong’s economy is expected to grow faster than previously forecast this year as consumer spending rebounds, while growth in rival financial hub Singapore is likely to slow as global demand weakens.
The Latest Bloomberg survey of economists, conducted on June 1-7, shows growth in Hong Kong will come in at 4.6 percent in 2023, up from a previous estimate of 3.4 percent.
Singapore’s gross domestic product is projected to expand 1.4 percent, down by half a percentage point, according to the survey.
“Hong Kong’s economy continues to see a consumption-driven rebound supported by tourism, boosting its short-term cyclical prospects,” said Gary Ng, a senior economist at Natixis SA.
Still, there are risks to the outlook from a slowdown in the global economy and rising interest rates, he said.
Economists raised their second-quarter growth forecasts by 1.7 percentage points to 3.3 percent in the latest survey. The economy is then expected to expand 6.7 percent in the third quarter and 7.1 percent in the final three months of the year.
Sri Lanka lifts import limits on 286 items as crisis eases
Sri Lanka lifted import restrictions on 286 items, the Finance Ministry said on Saturday, a fresh sign the South Asian nation is starting to emerge from its worst economic crisis in decades.
The Island off India’s southern coast plunged into crisis last year as its foreign exchange reserves ran out. The government limited imports on more than 3,200 items, including seafood, electronics, and even musical instruments.
Its Fortunes have improved over the past nine months as Sri Lanka secured a $2.9 billion bailout from the International Monetary Fund (IMF), moderated its once-soaring inflation and embarked on rebuilding its foreign exchange reserves.
Sri Lanka’s reserves grew 26 percent to a 17-month high of $3.5 billion in May, helped by stronger remittances and tourism earnings. The currency has risen about 24 percent this year, central bank data showed.
“With the economy stabilising, import restrictions on 286 items have been lifted from Friday midnight,” the Finance Ministry said in a statement.
Restrictions on 928 items will continue, including vehicle imports, which were banned in March 2020, the statement said.
Thai C.bank focused on domestic outlook
Thai Central bank officials said on Wednesday the policy rate is not yet at a “neutral level” and that it would focus more on medium-term economic data.
“The Committee will look at the impact in the future, medium-term orientation,” assistant governor Piti Disyatat said at an analysts’ meeting.
The Central bank gives more importance to the Thai economic outlook than that of foreign economies, Piti said adding that that Southeast Asia’s second-largest economy continues to recover.
The Monetary policy committee expected continued economic expansion with some upside risks as it raised the key interest rate last month for a sixth straight meeting, according to minutes of the meeting published on Wednesday.
The Central bank began policy normalisation in mid-2022.
On May 31, the Bank of Thailand’s (BOT) policy committee voted unanimously to raise the one-day repurchase rate by a quarter point to 2.00 percent, citing elevated core inflation.
“June inflation is expected to be close to the previous levels in May because due to a low base… and later this year demand-driven pressures will push up inflation,” senior director Surach Tanboon said.
Policy rate normalisation would be continued gradually and real interest rates should be positive, the minutes showed.