Global Business

Who are the discontents of globalisation?

JPMorgan London, by Håkan Dahlström, under a CC-BY-2.0 licence
The past months have been characterised by what can be called a “backlash against globalisation”. This development became most visible in the outcome of the Brexit referendum in the UK and the election of Donald Trump as the future president of the US. In both cases, the preceding campaigns massively referred to […]

Social finance: a new frontier for development in Indonesia

Jakarta – Gatot Subroto, by Dino Adyansyah, under a CC-BY-2.0 licence
Introduction

It is estimated that Asia Pacific countries face an annual development financing shortfall of about $44 billion. So if development challenges are to be tackled effectively, the slack in finances needs to be picked up by the private sector. This would bring market incentives for financial gain closer to public […]

Redesigning Argentina’s economic landscape

Buenos Aires, la ciudad contada, by Hernán Piñera, under a CC-BY-SA-2.0 licence
Most people know Argentina as the land of tango, Malbec, and some of the greatest soccer players of all times. But Argentina is also famous for being home to some of the most diverse and extreme landscapes of the world—from subtropical rainforests and Iguazu Falls in the north to the […]

Navigating the new anti-money laundering normal

Money laundering, by The Preiser Project, under a CC-BY-2.0 licence
A series of recent news events have highlighted the continued focus of global regulators on money laundering and compliance failures at international financial institutions — and made it clear this focus is only likely to intensify in the months ahead. This makes it more crucial than ever that institutions have the […]

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    Chinese leaders walk a tightrope on market reforms amid slowdown

Chinese leaders walk a tightrope on market reforms amid slowdown

Nanjing Road-Shanghai, by Khalid Albaih, under a CC-BY-2.0 licence
In August 2015, Chinese leaders announced policy changes aimed at making their currency more attuned to market forces. At first glance, the move seemed to fulfil a pledge made by President Xi Jinping in 2013 to give markets a “decisive” role in the economy. But the government coupled its plans with a […]

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    How Chinese firms reacted when told to change their share ownership structures

How Chinese firms reacted when told to change their share ownership structures

Lujiazui Finance and Trade Zone, by Suvcon, under a CC-BY-2.0 licence
You probably know that many new rules were put in place soon after the 2008/2009 financial crisis in order to prevent excessive risk taking and ethically questionable transactions by the financial sector. Did the banks follow the rules? The obvious answer would be yes, at least for many people. Banks […]

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    India’s reforms to attract investment present opportunities for European firms

India’s reforms to attract investment present opportunities for European firms

Mumbai, by Walkerssk, under a CC0 licence
Since independence in 1947 until 1991, India’s policy towards foreign direct investment (FDI) was ad hoc, and lacked consistent direction and proper institutions (Sahoo 2006; Sahoo et al. 2013). As a result, FDI inflows into India were negligible. However, following the balance-of-payments crisis in 1991, the comprehensive structural economic reforms included steps to […]

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    Why is there so little foreign direct investment in the Western Balkans?

Why is there so little foreign direct investment in the Western Balkans?

Western Balkans, by Olahus, own work, under a CC BY-SA 3.0 licence, via Wikimedia Commons
It is now more than quarter of a century since the demise of socialist economies in Europe was put in motion by the fall of the Berlin Wall. In many parts of Central and Eastern Europe, the transition from socialist planning to market capitalism is all but […]

Internet platforms are transforming global trade

Cardboard box, by bykst, under a CC0 licence
Since 2011, the eBay Public Policy Lab and a team of economists at Sidley Austin LLP have together studied the exporting practices of firms using the online commerce platform. We have uncovered a fundamental transformation within global trade. Global trade has expanded beyond container shipments of one large company’s wares along predetermined […]

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    Can North Africa’s energy challenges become opportunities?

Can North Africa’s energy challenges become opportunities?

Algerian desert, by Magharebia, under a CC-BY-2.0 licence
It is in Europe’s interest to foster stability, security and prosperity in North Africa. But so far Europe’s attempts to promote economic and political reform in the region have failed. The aftermath of the so-called ‘Arab Spring’ demonstrated the limitations of the EU’s leverage over economic and political developments in North Africa. But […]

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    Foreign investment in critical areas like nuclear power need a formal vetting process

Foreign investment in critical areas like nuclear power need a formal vetting process

Hinkley Point A power station, by Rick Crowley, under a CC BY-SA 2.0 licence
One of the first decisions taken by Theresa May as prime minister was to delay deciding on the £18 billion Hinkley Point nuclear power project. Because it was a centrepiece project as part of former chancellor George Osborne’s “Golden Age” of closer bilateral ties with China, the […]

The malling of America may be history

Mall of America interior, James Patterson, under a CC BY 2.0 licence, via Wikimedia Commons
Is the great American suburban shopping mall a dinosaur?

If you visit the site of Northland Center in suburban Detroit, you come away thinking so, because Northland was a trend-setter throughout its life cycle. It was the world’s largest shopping center when it opened in 1954, just as […]

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    Hinkley Point C nuclear station: an expensive solution to a cheap problem

Hinkley Point C nuclear station: an expensive solution to a cheap problem

Colour Scheme, by Mark Robinson, under a CC-BY-NC- 2.0 licence
The UK will soon break ground on its first new nuclear power plant in more than 20 years now that PM Teresa May has signed off on Hinkley. While clearly a political decision, given the involvement of both French and Chinese companies, my colleagues and I at Bloomberg New Energy Finance […]

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    Nigeria in recession: the devaluation came a day late, a dollar short

Nigeria in recession: the devaluation came a day late, a dollar short

Nigeria – Five Naira (₦5), (cropped), by Shardayyy, under a CC-BY-2.0 licence
In January 2016, I tabled a prognosis for Nigeria anchored on the premise of an economy set to tread a tight rope between soaring inflation and deceleration of its growth momentum. Seven months later, inflation had inched to a high of 17.1 per cent and the economy had […]

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    Now Indonesia has a sovereign wealth fund – and it won’t be the last

Now Indonesia has a sovereign wealth fund – and it won’t be the last

Key players in international finance

Sovereign wealth funds (SWFs) are large state owned investment funds. With assets under management of about US $7 trillion globally, SWFs have become key players in international finance – even surpassing the combined size of global hedge funds and private equity firms.

In the vast majority of cases SWFs were funded by the proceeds of oil and […]

The commodity price rout and Africa’s unusual electoral cycle

The ongoing electoral cycle in Sub-Saharan Africa is turning out to be somewhat unusual. In the Nigeria March 2015 poll, the People’s Democratic Party suffered its first loss since the end of military rule in 1999, whilst in South Africa’s August 2016 municipal election the ruling Africa National Congress (ANC) registered its worst performance since the end of apartheid […]

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    Most multinationals use unaffiliated suppliers in their supply chains

Most multinationals use unaffiliated suppliers in their supply chains

The global nature of supply chains has rapidly come to dominate international trade. This column presents new evidence on production fragmentation and intra-firm trade. For US corporations, cross-country shipments of goods between units of the corporation are rare, despite the fact that most US manufacturing parents own foreign affiliates in upstream or downstream industries.

In 1997, the chipmaker Intel invested […]

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    Well-managed Pakistani firms are more capital- intensive and more likely to export

Well-managed Pakistani firms are more capital- intensive and more likely to export

The causes and consequences of the vast differences in productivity within and across countries have been the subject of research for decades. Recently, economists have woken up to the important role of management practices in firms to explain these differences. Working with the State Bank of Pakistan and the Pakistan Bureau of Statistics, we have conducted what is to […]

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    Africa’s Nile basin countries should invest in rain, not big infrastructure projects

Africa’s Nile basin countries should invest in rain, not big infrastructure projects

Last month the The African Ministers’ Council on Water (AMCOW) and over 1000 experts gathered in Dar es Salaam during the Africa Water Week to discuss new pathways for development and increased investment in water infrastructure. The challenges are huge; the El Nino of last year showed the exposure of African economies to the vagaries of weather. Climate change […]

The art, and the deal, go global

Isabella Stewart Gardner was, in her day, the very model of a modern Medici. Beginning in 1891, she used her ample inheritance to buy up paintings by Old Masters and new artists alike during her frequent visits to Paris and Venice. She brought them back to her home town of Boston and displayed them in a museum built to […]