10 slides on the world economy in february 2014
DESCRIPTION
A short presentation looking at a few different areas of the world economy in February 2014. Sources: ONS, OECD and Eurostat. Follow @statshan on twitter and teaching with statistics on FB. Find more resources from me on the TES website.TRANSCRIPT
THE WORLD ECONOMYFEBRUARY 2014
These slides reflect the opinions of the author and not the official position of the ONS
Cyp
rus
Gre
ece
Bulg
ari
a
Slo
vaki
a
Port
ugal
Lith
uania
Sw
eden
Sw
itze
rland
Cze
ch R
epublic
Irela
nd
Spain
Cro
atia
Latv
ia
Italy
Pola
nd
Denm
ark
France
Hungary
Neth
erl
ands
Malta
Slo
venia
Belg
ium
Germ
any
Rom
ania
Aust
ria
Icela
nd
Luxe
mbourg
Est
onia
Finla
nd
United K
ingdom
Norw
ay
-2.0
-1.5
-1.0
-0.5
0.0
0.5
1.0
1.5
2.0
2.5
Annual Change in CPI for January 2014
UK
% change
Source: Eurostat
Price Level Changes in Europe
$19 billion
Facebook bought what’s app for:
Facebook went shopping . . .
$19 billion
Facebook bought what’s app for:
Facebook went shopping . . .
GDP of $18.9 billion
What could they have bought instead?
Mozambique
0
2
4
6
8
10
12
14Interest rate (%)
Turkey
Brazil
India
SouthAfrica
USA
Hot money refers to when funds are moved to one country to another in order to earn a short-term profit on interest differences and exchange rate shifts. They potentially lead to instability in a country because the transfers can happen very quickly – hence the term ‘hot’.
With the Fed’s interest rates set at a low 0.25% investors turned to riskier emerging economies for greater returns.
Now the US economy appears to be stabilising, investors are pulling their money out of the riskier assets and back to America.
To remain attractive to investors, central banks in emerging economies have increased their bank rates. You can see Turkey, India, Brazil and South Africa all saw rate rises in January, and Brazil increased theirs further in February, while the rest held steady.
Source: OECD
‘Hot’ Money
0
100
200
300
400
500
600
700
800
900
Annual GDP, Index 2000=100 Forecasts
ChinaRussia
Nigeria
Indonesia
IndiaBrazilTurkeySouthAfricaMexico
The MINTs – Mexico, Indonesia, Nigeria and Turkey have been identified as the new emerging economies to watch in the next few years. They all have young, largely literate, growing populations and low government debt levels, although they also have problems with poverty, lack of infrastructure and corruption.
Although Russia and China out of the BRICS countries are still seeing high forecasted growth, the remaining countries have seen growth tail off in the last couple of years. Nigeria in particular out of the MINT economies has high growth forecasted for 2013 and 2014.
Source: OECD
MINTs and BRICS
Current price productivity estimates are indexed to UK=100 and show each country’s productivity relative to that of the UK in that particular year
Productivity: UK vs. The World
2008Q1
2008Q2
2008Q3
2008Q4
2009Q1
2009Q2
2009Q3
2009Q4
2010Q1
2010Q2
2010Q3
2010Q4
2011Q1
2011Q2
2011Q3
2011Q4
2012Q1
2012Q2
2012Q3
2012Q4
2013Q1
2013Q2
2013Q3
2013Q4
90
92
94
96
98
100
102
104
GDP Growth, Index2008 Q1 = 100
Germany
Italy
UK
EU28
Eurozone
Spain
France
Source: Eurostat
Quarterly GDP Growth in Europe
6.7% 1.8%59.1
%8.1%
1. Eurozone + Norway &Switzerland (59.1%)2. China (8.1%)3. USA (6.7%)4. Japan (1.8%) Source: ONS
UK Imports in December 2013
13.5% 2.0
%
53.4%
4.1%
1. Eurozone + Norway &Switzerland (53.4%)2. USA (13.5%)3. China (4.1%)4. United Arab Emirates (2.0%) Source: ONS
UK Exports in December 2013
2007 Q1
2007 Q2
2007 Q3
2007 Q4
2008 Q1
2008 Q2
2008 Q3
2008 Q4
2009 Q1
2009 Q2
2009 Q3
2009 Q4
2010 Q1
2010 Q2
2010 Q3
2010 Q4
2011 Q1
2011 Q2
2011 Q3
2011 Q4
2012 Q1
2012 Q2
2012 Q3
2012 Q4
2013 Q1
2013 Q2
2013 Q3
2013 Q4
0
200
400
600
800
1000
1200
1400
1600
1800
£ millions
Value of UK Exportsto UAE
Value of UK Importsfrom UAE
The UAE is an interesting
trading partner because it is
resource rich and has a high GDP
per capita, but it also suffers from inequality and in some ways can still be classified as a developing
economy.
This is reflected by the key sectors for exports from
the UK which focus on
infrastructure projects such as
construction, financial and professional services, and education.
Source: ONS
UK Trade with the United Arab Emirates (UAE)
Trade Case Study