In The News

Japanese-type Downturn

July 22, 2004
The governor of South Korea’s central bank publicly expressed on Tuesday what many have already been speculating: that Korea might be headed for a Japanese-style, decade-long slump. An aging population, a falling interest rate and consumer price index, and a switch from low wages and high profitability to high wages and low profitability have all alerted government officials to this possibility...

Germany a Gateway to Europe for Chinese Businesses

Mark-Werner Dreisörner July 16, 2004
For years German investors have taken advantage of China’s low wages and huge market potential to expand their operations, but a recent trends show investment flowing the other way: from China to Germany. Hamburg alone now hosts over 300 Chinese businesses, and growth in Chinese investment across the country is likely to continue since Germany is seen as a gateway to Europe. Wang Yan of...

US Troop Pullout Will Hit South Korean Economy

Lee Tee Jong July 13, 2004
Plans to slash the number of American troops stationed in South Korea may have adverse economic effects on an already ailing local economy. Though a timetable has not yet been set, the current troop presence of 37,000 is to be cut by 12,500. The withdrawal, says this article in Singapore's Straits Times, will likely result in a loss of jobs by thousands of Koreans employed by the US and...

Security Above All

July 2, 2004
With the coming into force of a United Nations-initiated shipping code a new barrier has been erected in global trading. The International Ships and Port Facility Security Code which was adopted by the UN members in 2002 requires countries to undertake security measures to prevent terrorist use of international shipping. This editorial in a South African newspaper echoes the mixed reaction the...

Exploding the Myths of Offshoring

Martin N. Baily July 1, 2004
In the heated public discourse in the US on outsourcing the aspect that is most often highlighted is the threat of American job loss to low-wage workers in India. In this essay a former Clinton administration economist Martin Baily and Diana Farrell , director of the McKinsey Global Institute make the case that outsourcing is in fact win-win for both the countries. They say that with the digital...

Brazil's Big Stake in Cotton Likely to Become Bigger

Todd Benson June 29, 2004
For some time now, Brazil has been a leading critic of cotton subsidies of over $3 billion paid out to American cotton growers. Its stand against such supports, which leads to increased output in the US and artificially depresses global prices, is finally paying off. With the World Trade Organization ruling in early June that American cotton subsidies violated international trade rules, Brazil is...

Death Knell for Cross-Border Leasing Deals

Heidi Sylvester June 25, 2004
When the US Congress voted to close a tax law loophole this month, some German city governments began to worry. Over the past seven years Germany municipalities have signed more than 150 cross-border leasing agreements with US investors. Under the agreements, Americans leased German infrastructure facilities – sewage plants, waste water facilities, etc. – and wrote off the lump-sum cost from...