The document provides an economic capsule covering topics in banking/finance, the economy/business, and international news. Some key points:
1) Commercial Bank was named Best Internet Bank in Sri Lanka for the third year and launched a mobile remittance channel between South Korea and Sri Lanka.
2) Sri Lanka's economy grew 3.2% in the first quarter of 2018. The US Federal Reserve raised interest rates which could impact emerging markets and trigger capital outflows from Sri Lanka.
3) Global foreign direct investment flows fell in 2017 and growth prospects for 2018 remain modest due to trade tensions and tax reforms. China and the EU warned that unilateral trade actions risk pushing the world into recession.
Based on our scuttlebutt and feedback from industry sources and ground views of experts regarding the current state of affairs in India due to Coronavirus lockdown, We shall now present our thoughts on investment strategy for post lock down period.
Based on our scuttlebutt and feedback from industry sources and ground views of experts regarding the current state of affairs in India due to Coronavirus lockdown, We shall now present our thoughts on investment strategy for post lock down period.
Colliers Vietnam Q1 2014 Investment Report: Read and follow the top economic indicators for Vietnam, M&A activity, and major developments in finance, banking, and legal. Published Monthly with contribution from LNT & Partners Law Firm.
OBJECTIVE
Global economic activity has come to a near standstill as Covid-19 related lockdowns are imposed across a widening swathe of affected countries. Financial markets have been facing high volatility due to panic sell-offs resulting in destruction of equity markets. Financial institutions have started encountering liquidity constraints and lags in credit flow, thereby putting debt servicing at risk. The need for strong fiscal measures has become the voice of the banking sector to revive. In this webinar, we shall be focusing on the various spheres of the banking sector which has the hard hit due to the pandemic’s intensity, the RBI’s measures to cope up with the current slack and the way forward for revival of the coveted sector.
OBJECTIVE
The Reserve Bank of India on 27th December 2019 released the 20th issue of the Financial Stability Report (FSR). The FSR reflects the collective assessment of the Sub-Committee of the Financial Stability and Development Council (FSDC) on risks to financial stability, as also the resilience of the financial system. The Report also discusses issues relating to development and regulation of the financial sector. In this Webinar, we shall understand the key findings and observations made in the Report.
Foreign Direct Investment. Political Economic Digest Series - XVIAkash Shrestha
In this issue, we will be discussing about Foreign Direct Investment (FDI).
Foreign Direct Investment has been a very productive tool for the economic growth of many countries. Recently after the government made the decision to celebrate 2012/13 as investment year and after the agreement with India i.e. Bilateral Investment Promotion and Protection Agreement, the topic of Foreign Direct Investment has been highly discussed among the lawmakers, policymakers and general public. The examples provided in this issue of different countries regarding FDI has shown how the growth rate is positively affected by the investment from outside the country.
We are pleased to release the December 2017 Africa Market Update covering the economies of Zambia, Nigeria, Kenya, Tanzania, Uganda and Rwanda. This issue comes against the backdrop of Nigeria's credit risk downgrade by Moody's and discusses key issues underlying the macroeconomic environment including the uptick in the price of oil, resilience by the Naira and contraction in credit to the private sector. Our next issue, due mid January 2018, will provide an exhaustive stock take of events that impacted the investment landscape in 2017 and provide an outlook into 2018.
OBJECTIVE
In these times of economic and financial distress owing to COVID-19 pandemic, we would like to stress upon the central bank's relentless efforts to revive the Indian economy. The sizeable rate cut and few other regulatory policies will ease the functioning of the banking system and make sure there is enough liquidity in the economy to promote growth.
In this webinar, we shall analyse the array of financial weapons brought into play by RBI through its Development and Regulatory Policy, and the impact they would have on the economy when they are put to use.
Final project unlocking investment & finance in emerging markets and develo...Damian Attah
Nigeria's GDP has been growing in a slower pace compared to the population growth rate of 2.6%. The year-on-year budget deficit and the slow growth in government revenue has continued to constrain investment in critical social and physical infrastructure that will be needed to be on the path of economic growth. The ineffective fiscal framework and erosion of social trust in government spending has resulted to a tax to GDP ratio of less than 1% compared to the minimum requirement of 15% recommended for an emerging nation like Nigeria. The country's current debt profile of over $73billion and the allocation of 23% of the annual budget to debt servicing makes additional loans quite unsustainable. Funding the critical sectors that will create a transformative growth will require the crowding in of required financing from both the public and private sources and the unlocking of investment opportunities that will attract FDI, ODA and OOF finance. Posing as a government official that is exploring the option of attracting public, private and multilateral funding, the slides seeks to address the following:
(a) What are the estimated financing needs for the country’s development?
(b) Which sources of finance are available to you international and domestically, from both public and private sources?
(c) How will the country access these?
(d) How will you work with multilateral development banks to address barriers to accessing these sources of finance?
Presentation Scoreboard Launch_29 March 2022.pptxOECDregions
he COVID-19 crisis caused profound disruptions in the global economy, with SMEs and entrepreneurs, particularly hard hit. Swift measures implemented by governments and public financial institutions provided a crucial lifeline for liquidity-strapped SMEs. The 10th edition of Financing SMEs and Entrepreneurs 2022: An OECD Scoreboard sheds light on the impacts of the crisis on SME finance, tracking the latest developments in debt, equity, asset-based finance, and framework conditions, along with recent policy developments for 48 countries around the world. It shows that lending continued to flow to SMEs during the pandemic, with unprecedented growth in outstanding SME loans. What is more, credit conditions relaxed significantly: interest rates registered record lows, interest rate spreads narrowed considerably, and collateral requirements declined in most Scoreboard countries. In contrast, alternative sources of finance such as leasing and factoring declined significantly, in part because of the large uptake of credit. Evidence on equity finance shows a resilient venture capital sector, with some fragility in early-stage finance. The thematic chapter of this report assesses the evolution of SME financing support during the crisis, from the rescue to recovery phases. It documents a fall in the level of SME-related support in national recovery packages compared to earlier rescue measures.
Tax Incentives and Foreign Direct Investment in Nigeriaiosrjce
Given the significance of Foreign Direct Investment (FDI) to economic growth and the use of tax
incentives as a strategy among government of various countries to attract FDI, this study examines the influence
of tax incentives in the decision of an investor to locate FDI in Nigeria. Data were drawn from annual statistical
bulletin of the Central Bank of Nigeria and the World Bank World Development Indicators Database. The work
employs a model of multiple regressions using static Error Correction Modelling (ECM) to determine the time
series properties of tax incentives captured by annual tax revenue as a percentage of Gross Domestic Product
(GDP)and FDI. The result showed that FDI response to tax incentives is negatively significant, that is, increase
in tax incentives does not bring about a corresponding increase in FDI. Based on the findings, the paper
recommends, amongst others, that dependence on tax incentives should be reduced and more attention be put on
other incentives strategies such as stable economic reforms and stable political climate.
Colliers Vietnam Q1 2014 Investment Report: Read and follow the top economic indicators for Vietnam, M&A activity, and major developments in finance, banking, and legal. Published Monthly with contribution from LNT & Partners Law Firm.
OBJECTIVE
Global economic activity has come to a near standstill as Covid-19 related lockdowns are imposed across a widening swathe of affected countries. Financial markets have been facing high volatility due to panic sell-offs resulting in destruction of equity markets. Financial institutions have started encountering liquidity constraints and lags in credit flow, thereby putting debt servicing at risk. The need for strong fiscal measures has become the voice of the banking sector to revive. In this webinar, we shall be focusing on the various spheres of the banking sector which has the hard hit due to the pandemic’s intensity, the RBI’s measures to cope up with the current slack and the way forward for revival of the coveted sector.
OBJECTIVE
The Reserve Bank of India on 27th December 2019 released the 20th issue of the Financial Stability Report (FSR). The FSR reflects the collective assessment of the Sub-Committee of the Financial Stability and Development Council (FSDC) on risks to financial stability, as also the resilience of the financial system. The Report also discusses issues relating to development and regulation of the financial sector. In this Webinar, we shall understand the key findings and observations made in the Report.
Foreign Direct Investment. Political Economic Digest Series - XVIAkash Shrestha
In this issue, we will be discussing about Foreign Direct Investment (FDI).
Foreign Direct Investment has been a very productive tool for the economic growth of many countries. Recently after the government made the decision to celebrate 2012/13 as investment year and after the agreement with India i.e. Bilateral Investment Promotion and Protection Agreement, the topic of Foreign Direct Investment has been highly discussed among the lawmakers, policymakers and general public. The examples provided in this issue of different countries regarding FDI has shown how the growth rate is positively affected by the investment from outside the country.
We are pleased to release the December 2017 Africa Market Update covering the economies of Zambia, Nigeria, Kenya, Tanzania, Uganda and Rwanda. This issue comes against the backdrop of Nigeria's credit risk downgrade by Moody's and discusses key issues underlying the macroeconomic environment including the uptick in the price of oil, resilience by the Naira and contraction in credit to the private sector. Our next issue, due mid January 2018, will provide an exhaustive stock take of events that impacted the investment landscape in 2017 and provide an outlook into 2018.
OBJECTIVE
In these times of economic and financial distress owing to COVID-19 pandemic, we would like to stress upon the central bank's relentless efforts to revive the Indian economy. The sizeable rate cut and few other regulatory policies will ease the functioning of the banking system and make sure there is enough liquidity in the economy to promote growth.
In this webinar, we shall analyse the array of financial weapons brought into play by RBI through its Development and Regulatory Policy, and the impact they would have on the economy when they are put to use.
Final project unlocking investment & finance in emerging markets and develo...Damian Attah
Nigeria's GDP has been growing in a slower pace compared to the population growth rate of 2.6%. The year-on-year budget deficit and the slow growth in government revenue has continued to constrain investment in critical social and physical infrastructure that will be needed to be on the path of economic growth. The ineffective fiscal framework and erosion of social trust in government spending has resulted to a tax to GDP ratio of less than 1% compared to the minimum requirement of 15% recommended for an emerging nation like Nigeria. The country's current debt profile of over $73billion and the allocation of 23% of the annual budget to debt servicing makes additional loans quite unsustainable. Funding the critical sectors that will create a transformative growth will require the crowding in of required financing from both the public and private sources and the unlocking of investment opportunities that will attract FDI, ODA and OOF finance. Posing as a government official that is exploring the option of attracting public, private and multilateral funding, the slides seeks to address the following:
(a) What are the estimated financing needs for the country’s development?
(b) Which sources of finance are available to you international and domestically, from both public and private sources?
(c) How will the country access these?
(d) How will you work with multilateral development banks to address barriers to accessing these sources of finance?
Presentation Scoreboard Launch_29 March 2022.pptxOECDregions
he COVID-19 crisis caused profound disruptions in the global economy, with SMEs and entrepreneurs, particularly hard hit. Swift measures implemented by governments and public financial institutions provided a crucial lifeline for liquidity-strapped SMEs. The 10th edition of Financing SMEs and Entrepreneurs 2022: An OECD Scoreboard sheds light on the impacts of the crisis on SME finance, tracking the latest developments in debt, equity, asset-based finance, and framework conditions, along with recent policy developments for 48 countries around the world. It shows that lending continued to flow to SMEs during the pandemic, with unprecedented growth in outstanding SME loans. What is more, credit conditions relaxed significantly: interest rates registered record lows, interest rate spreads narrowed considerably, and collateral requirements declined in most Scoreboard countries. In contrast, alternative sources of finance such as leasing and factoring declined significantly, in part because of the large uptake of credit. Evidence on equity finance shows a resilient venture capital sector, with some fragility in early-stage finance. The thematic chapter of this report assesses the evolution of SME financing support during the crisis, from the rescue to recovery phases. It documents a fall in the level of SME-related support in national recovery packages compared to earlier rescue measures.
Tax Incentives and Foreign Direct Investment in Nigeriaiosrjce
Given the significance of Foreign Direct Investment (FDI) to economic growth and the use of tax
incentives as a strategy among government of various countries to attract FDI, this study examines the influence
of tax incentives in the decision of an investor to locate FDI in Nigeria. Data were drawn from annual statistical
bulletin of the Central Bank of Nigeria and the World Bank World Development Indicators Database. The work
employs a model of multiple regressions using static Error Correction Modelling (ECM) to determine the time
series properties of tax incentives captured by annual tax revenue as a percentage of Gross Domestic Product
(GDP)and FDI. The result showed that FDI response to tax incentives is negatively significant, that is, increase
in tax incentives does not bring about a corresponding increase in FDI. Based on the findings, the paper
recommends, amongst others, that dependence on tax incentives should be reduced and more attention be put on
other incentives strategies such as stable economic reforms and stable political climate.
The presentation identifies the policy framework toward FDI, monetary and non-monetary incentives offered by the government of Bangladesh to attract FDI, analyzes the rising FDI flow into Bangladesh during last ten years, the sectors attracting major FDI inflows, future of the potential sectors for investment in Bangladesh and identifies the foreign countries that are investing in the Bangladesh economy.
Bangladesh’s hi-tech industry is gaming forward on the back of steady economic indicators that signal rising per capita income, a surging young-consumer market indicative of future demand for tech products and services, and favorable policies that paved the ground for local and international players to explore the market. The emerging startup ecosystem has also been playing an instrumental role in channeling FDIs to industries like FinTech, Logistics, and Mobility since 2016. While the ongoing government initiatives in building capacities to sustain investment are portraying a positive future, over-supply of low-cost labor remains one of the major growth drivers for the hi-tech industry.
what is the best method to sell pi coins in 2024DOT TECH
The best way to sell your pi coins safely is trading with an exchange..but since pi is not launched in any exchange, and second option is through a VERIFIED pi merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and pioneers and resell them to Investors looking forward to hold massive amounts before mainnet launch in 2026.
I will leave the telegram contact of my personal pi merchant to trade pi coins with.
@Pi_vendor_247
how can I sell pi coins after successfully completing KYCDOT TECH
Pi coins is not launched yet in any exchange 💱 this means it's not swappable, the current pi displaying on coin market cap is the iou version of pi. And you can learn all about that on my previous post.
RIGHT NOW THE ONLY WAY you can sell pi coins is through verified pi merchants. A pi merchant is someone who buys pi coins and resell them to exchanges and crypto whales. Looking forward to hold massive quantities of pi coins before the mainnet launch.
This is because pi network is not doing any pre-sale or ico offerings, the only way to get my coins is from buying from miners. So a merchant facilitates the transactions between the miners and these exchanges holding pi.
I and my friends has sold more than 6000 pi coins successfully with this method. I will be happy to share the contact of my personal pi merchant. The one i trade with, if you have your own merchant you can trade with them. For those who are new.
Message: @Pi_vendor_247 on telegram.
I wouldn't advise you selling all percentage of the pi coins. Leave at least a before so its a win win during open mainnet. Have a nice day pioneers ♥️
#kyc #mainnet #picoins #pi #sellpi #piwallet
#pinetwork
how to sell pi coins at high rate quickly.DOT TECH
Where can I sell my pi coins at a high rate.
Pi is not launched yet on any exchange. But one can easily sell his or her pi coins to investors who want to hold pi till mainnet launch.
This means crypto whales want to hold pi. And you can get a good rate for selling pi to them. I will leave the telegram contact of my personal pi vendor below.
A vendor is someone who buys from a miner and resell it to a holder or crypto whale.
Here is the telegram contact of my vendor:
@Pi_vendor_247
how to sell pi coins effectively (from 50 - 100k pi)DOT TECH
Anywhere in the world, including Africa, America, and Europe, you can sell Pi Network Coins online and receive cash through online payment options.
Pi has not yet been launched on any exchange because we are currently using the confined Mainnet. The planned launch date for Pi is June 28, 2026.
Reselling to investors who want to hold until the mainnet launch in 2026 is currently the sole way to sell.
Consequently, right now. All you need to do is select the right pi network provider.
Who is a pi merchant?
An individual who buys coins from miners on the pi network and resells them to investors hoping to hang onto them until the mainnet is launched is known as a pi merchant.
debuts.
I'll provide you the Telegram username
@Pi_vendor_247
how to swap pi coins to foreign currency withdrawable.DOT TECH
As of my last update, Pi is still in the testing phase and is not tradable on any exchanges.
However, Pi Network has announced plans to launch its Testnet and Mainnet in the future, which may include listing Pi on exchanges.
The current method for selling pi coins involves exchanging them with a pi vendor who purchases pi coins for investment reasons.
If you want to sell your pi coins, reach out to a pi vendor and sell them to anyone looking to sell pi coins from any country around the globe.
Below is the contact information for my personal pi vendor.
Telegram: @Pi_vendor_247
Exploring Abhay Bhutada’s Views After Poonawalla Fincorp’s Collaboration With...beulahfernandes8
The financial landscape in India has witnessed a significant development with the recent collaboration between Poonawalla Fincorp and IndusInd Bank.
The launch of the co-branded credit card, the IndusInd Bank Poonawalla Fincorp eLITE RuPay Platinum Credit Card, marks a major milestone for both entities.
This strategic move aims to redefine and elevate the banking experience for customers.
how to sell pi coins in South Korea profitably.DOT TECH
Yes. You can sell your pi network coins in South Korea or any other country, by finding a verified pi merchant
What is a verified pi merchant?
Since pi network is not launched yet on any exchange, the only way you can sell pi coins is by selling to a verified pi merchant, and this is because pi network is not launched yet on any exchange and no pre-sale or ico offerings Is done on pi.
Since there is no pre-sale, the only way exchanges can get pi is by buying from miners. So a pi merchant facilitates these transactions by acting as a bridge for both transactions.
How can i find a pi vendor/merchant?
Well for those who haven't traded with a pi merchant or who don't already have one. I will leave the telegram id of my personal pi merchant who i trade pi with.
Tele gram: @Pi_vendor_247
#pi #sell #nigeria #pinetwork #picoins #sellpi #Nigerian #tradepi #pinetworkcoins #sellmypi
Empowering the Unbanked: The Vital Role of NBFCs in Promoting Financial Inclu...Vighnesh Shashtri
In India, financial inclusion remains a critical challenge, with a significant portion of the population still unbanked. Non-Banking Financial Companies (NBFCs) have emerged as key players in bridging this gap by providing financial services to those often overlooked by traditional banking institutions. This article delves into how NBFCs are fostering financial inclusion and empowering the unbanked.
Financial Assets: Debit vs Equity Securities.pptxWrito-Finance
financial assets represent claim for future benefit or cash. Financial assets are formed by establishing contracts between participants. These financial assets are used for collection of huge amounts of money for business purposes.
Two major Types: Debt Securities and Equity Securities.
Debt Securities are Also known as fixed-income securities or instruments. The type of assets is formed by establishing contracts between investor and issuer of the asset.
• The first type of Debit securities is BONDS. Bonds are issued by corporations and government (both local and national government).
• The second important type of Debit security is NOTES. Apart from similarities associated with notes and bonds, notes have shorter term maturity.
• The 3rd important type of Debit security is TRESURY BILLS. These securities have short-term ranging from three months, six months, and one year. Issuer of such securities are governments.
• Above discussed debit securities are mostly issued by governments and corporations. CERTIFICATE OF DEPOSITS CDs are issued by Banks and Financial Institutions. Risk factor associated with CDs gets reduced when issued by reputable institutions or Banks.
Following are the risk attached with debt securities: Credit risk, interest rate risk and currency risk
There are no fixed maturity dates in such securities, and asset’s value is determined by company’s performance. There are two major types of equity securities: common stock and preferred stock.
Common Stock: These are simple equity securities and bear no complexities which the preferred stock bears. Holders of such securities or instrument have the voting rights when it comes to select the company’s board of director or the business decisions to be made.
Preferred Stock: Preferred stocks are sometime referred to as hybrid securities, because it contains elements of both debit security and equity security. Preferred stock confers ownership rights to security holder that is why it is equity instrument
<a href="https://www.writofinance.com/equity-securities-features-types-risk/" >Equity securities </a> as a whole is used for capital funding for companies. Companies have multiple expenses to cover. Potential growth of company is required in competitive market. So, these securities are used for capital generation, and then uses it for company’s growth.
Concluding remarks
Both are employed in business. Businesses are often established through debit securities, then what is the need for equity securities. Companies have to cover multiple expenses and expansion of business. They can also use equity instruments for repayment of debits. So, there are multiple uses for securities. As an investor, you need tools for analysis. Investment decisions are made by carefully analyzing the market. For better analysis of the stock market, investors often employ financial analysis of companies.
Even tho Pi network is not listed on any exchange yet.
Buying/Selling or investing in pi network coins is highly possible through the help of vendors. You can buy from vendors[ buy directly from the pi network miners and resell it]. I will leave the telegram contact of my personal vendor.
@Pi_vendor_247
how to sell pi coins on Bitmart crypto exchangeDOT TECH
Yes. Pi network coins can be exchanged but not on bitmart exchange. Because pi network is still in the enclosed mainnet. The only way pioneers are able to trade pi coins is by reselling the pi coins to pi verified merchants.
A verified merchant is someone who buys pi network coins and resell it to exchanges looking forward to hold till mainnet launch.
I will leave the telegram contact of my personal pi merchant to trade with.
@Pi_vendor_247
2. CONTENTS BANKING & FINANCE
Commercial Bank adjudged Best Internet Bank in Sri Lanka for 3rd year in a row
Commercial Bank launches mobile remittance channel between SK & SL
ECONOMY & BUSINESS
Economy grows at 3.2% in 1Q, 2018
FED hikes rates
Sri Lanka - prudent strategy
Global investment trends and prospects
Sri Lanka Risk Assessment Matrix: IMF
Beira Lake to be developed into commercial hub
INTERNATIONAL
China, Europe Warn Trade War Could Trigger Global Recession
World’s rich grow richer
Japan’s Robots
4. Commercial Bank adjudged Best Internet
Bank in Sri Lanka for 3rd year in a row
< Research & Development Unit >
Commercial Bank has been named the Best
Internet Bank in Sri Lanka by Global Banking &
Finance Review of the UK, for the third successive
year.
The accolade was created to recognise companies
within the global financial community that provide
their customers a high quality of service and
innovation via online and digital platforms.
The value of Commercial Bank’s Online Banking transactions grew to Rs 663 bn by
the end of 2017, making it one of the most popular digital payment platforms of
Sri Lanka.
5. Commercial Bank launches mobile
remittance channel between SK & SL
< Research & Development Unit >
Commercial Bank has become the first Sri Lankan
institution to launch a ‘Mobile to Account Remittance
Service’ between South Korea and Sri Lanka, facilitating
real time fund transfers from an estimated 30,000 Sri
Lankans employed in the East Asian nation.
The service, launched in collaboration with Global Money Express Co Ltd.
(GME), one of the first exchange companies in the Republic to obtain a
money transfer licence, paves the way for real time fund transfers between
the two countries at lower charges and higher exchange rates.
Prior to the launch of the GME-Commercial Bank Mobile to Account
Remittance Service, Commercial Bank’s own sophisticated real-time on-line
money transfer service ‘e-Exchange’generated substantial foreign exchange
earnings annually in remittances from expatriate Sri Lankans working in
South Korea.
7. Economy grows at 3.2% in 1Q, 2018
< Research & Development Unit >
30.4
7.0
53.6
8.9
Contribution to the GDP (%) Agricultural activities 4.8%
Growing of Rice 56.6%
Growing of Cereals (except rice) 40.2%
Growing of Vegetables 22.3%
Growing of Oleaginous Fruits ( including coconut) (13.5%)
Growing of Rubber (13.9%)
Industrial activities 1.0%
Electricity, gas, steam and air conditioning supply 10.2%
Construction activity (4.9%)
Service activities 4.4%
Financial Service activities and auxiliary financial services 12.2
Insurance, reinsurance and pension funding 9.3
Growth % - Sectorwise
Source: DCS
8. FED hikes rates
• The US Federal Reserve raised the target federal funds rate by 0.25%, taking it to
1.75% to 2%. The rise marks the Fed's seventh rate increase since 2015.
Global impact
• Some of the most dramatic effects have appeared in emerging
markets, as higher US rates lure back investors who in recent years
had looked for returns abroad.
• The retreat from emerging markets remains relatively modest, with
flows to bond and equity funds down less than 10% from their
peaks.
• But it has coincided with - and partially fuelled - a stronger dollar,
contributing to currency crises in countries such as Argentina,
Turkey and Brazil.
• It has also prompted central banks elsewhere, including in
Indonesia, Malaysia and Hong Kong, to raise their own interest
rates in defence.
9. Sri Lanka - prudent strategy
• As pointed above, Sri Lanka’s GDP growth rate for
1Q, 2018 is only 3.2%.
• Therefore, some may point out that it may be good
to try and boost growth by reducing interest rates.
• However, at a time when regional economies have
increased their interest rates in response to the
increase in the FED Funds Rate in the US, Sri Lanka
cut its policy lending rate by 25 basis points in early
April, 2018.
• Hence, if there are further rate cuts in Sri Lanka, it
could trigger greater foreign fund outflows, thereby
applying further pressure on the rupee which has
depreciated by 3.3% year-to-date 22nd June, 2018.
• Foreigners had sold Rs.22.5 bn worth of government
bonds year-to-date June 10, 2018.
Cont.
10. Sri Lanka - prudent strategy (cont.)
• At a time when the US is increasing its FED Funds Rate, it may be unwise for a
country like Sri Lanka to attempt policy rate cuts, since that may contribute to an
intensification of government bond sales by foreigners (pls. refer figure in previous
slide) thereby applying further pressure on the rupee.
• In view of the above, a more prudent strategy to boost GDP growth would be to
take steps to increase domestic investments and Foreign Direct Investments (FDI)
by maintaining political stability, policy consistency, eliminating bureaucratic delays
and improving the efficiency and delivery of public services.
11. Global investment trends and prospects
< Research & Development Unit >
• Global foreign direct investment (FDI) flows 2017 fell
by 23 % to $1.43 trillion. This is in stark contrast to the
accelerated growth in GDP and trade.
• FDI flows to developing economies remained stable at
$671 bn, seeing no recovery following the 10 % drop in
2016.
• Inward FDI flows to developed economies fell sharply,
by 37 %, to $712 bn.
• Projections for global FDI in 2018 show fragile growth.
Global flows are forecast to increase marginally, by up
to 10 %, but remain well below the average over the
past 10 years.
Cont.
12. Global investment trends and prospects (cont.)
< Research & Development Unit >
• However, risks are significant, and policy uncertainty abounds.
- Escalation and broadening of trade tensions could negatively affect
investment in global value chains (GVCs).
- In addition, tax reforms in the United States and greater tax competition are
likely to significantly affect global investment patterns.
• A decrease in rates of return is a key contributor to the investment
downturn.
- The global average return on foreign investment is now at 6.7 %, down from
8.1 % in 2012. Return on investment is in decline across all regions.
• FDI activity was lower across all sectors.
- Mergers & Acquisitions values were down in the primary, manufacturing and
services sectors.
Cont.
13. Global investment trends and prospects (cont.)
< Research & Development Unit >
- The fall in greenfield announcements in 2017 was
concentrated in services.
- However, over the past five years, the level of greenfield
projects in manufacturing has been consistently lower
than in the preceding five-year period across all
developing regions.
• Growth in global value chains (GVCs) has stagnated.
- Growth in GVC participation decreased significantly this
decade compared with the last, across all regions,
developed and developing.
- The GVC slowdown shows a clear correlation with the
FDI trend and confirms the impact of the FDI trend on
global trade patterns.
Cont.
What is a 'Green Field Investment’
A type of foreign direct investment (FDI)
where a parent company builds its
operations in a foreign country from the
ground up.
In addition to the construction of new
production facilities, these projects can
also include the building of new
distribution hubs, offices and living
quarters. (Investopedia)
What are GVCs?
Companies used to make things
primarily in one country. That has all
changed. Today, a single finished
product often results from
manufacturing and assembly in multiple
countries, with each step in the process
adding value to the end product.
Through GVCs, countries trade more
than products; they trade know-how,
and make things together. Imports of
goods and services matter as much as
exports to successful GVCs. (World Bank)
Source: World Investment Report 2018
14. < Research & Development Unit >Source: UNCTAD, FDI/MNE database (www.unctad.org/fdistatistics)
Cont.
15. < Research & Development Unit >
• Government policy should focus on matching local industrial policy with free trade
deals as structural changes in the economy cannot be accomplished through
liberalization alone according to Ms. Wijeratne.
• Drawing a connection between industrial policies and investment policies, Ms.
Wijeratne points out that a chapter on investment liberalisation in a FTA for
example cannot stand alone from a holistic and integrated industrial and
agricultural policy which according to the World Investment Report 2018 has to
contain detailed pragmatic recommendations and a timeline for action with clearly
delineated division of responsibility among public and private sector stakeholders.
In the backdrop of declining global foreign investment flows Sri Lanka’s
Director General of Commerce, Ms. Sonali Wijeratne, has pointed out:
16. Sri Lanka Risk Assessment Matrix: IMF
Cont.
PotentialDomesticShocks
17. Sri Lanka Risk Assessment Matrix: IMF (cont.)PotentialExternalShocks
Source: IMF Sri Lanka 2018 Article IV – June 2018
18. < Research & Development Unit >
Over 200 acres of land around the Baire
Lake in Colombo 02 belonging to the Ports
Authority, Sathosa and Transport Ministry
are being developed as a Commercial hub,
according to the ministry of Megapolis and
Western Development.
• According to the Megapolis Minister, two 2.5
kilometre walk ways from Vauxhall street to
Peoples Bank HQ and another from Gangarama
temple to Hilton hotel will also be built soon.
• Under the proposed new development in the area
on the other side of D.R. Wijewardane Mawatha
the railway station will also be upgraded as a main
transport hub.
• The banks of Beria Lake will be developed initially
before executing the development activities on the
land adjoining the lake whilst improving the quality
of environment and beauty of the city.
• World bank will part sponsor the funding of the
project and the rest will be from the government.
Beira Lake to be developed into commercial hub
20. < Research & Development Unit >
China, Europe Warn Trade War Could Trigger
Global Recession
- Vice Premier Liu He, President Xi Jinping’s top
economic adviser stated China and the EU had agreed
to defend the multilateral trading system, following
talks in Beijing.
- The comments, made at a press briefing with European Commission Vice President
Jyrki Katainen, come as both sides prepare to face off against U.S. President Donald
Trump’s tariff threats.
- Both China and the EU are coming under pressure from Trump, as the U.S. president
seeks to remake a global trading system that he sees as rigged against the world’s
largest economy. Source: Bloomberg
China and the European Union vowed to oppose
trade protectionism in an apparent rebuke to the
U.S., saying unilateral actions risked pushing the
world into a recession.
21. < Research & Development Unit >
World’s rich grow richer
Global personal financial wealth grew by 12% in 2017 to $201.9 trillion
in US dollar terms.
The total was roughly 2.5 times as large as the world’s GDP for the year ($81 trillion).
Source: Global Wealth Report 2018 - BCG
‒ The main drivers were the bull market environment in all
major economies with wealth in equities and investment
funds showing by far the strongest growth and the
significant strengthening of most major currencies against
the dollar.
‒ In terms of asset classes, $121.6 trillion (60%) of global
wealth took the form of investable assets mainly equities,
investment funds, currency and deposits, and bonds with
the remaining $80.3 trillion (40%) held in non-investable
or low-liquidity assets such as life insurance, pensions
funds, and equity in unquoted companies.
22. Japan’s Robots
Japan is also one of the most robot-integrated economies in the world in terms of
“robot density” measured as the number of robots relative to humans in
manufacturing and industry.
Japan led the world in this measure until 2009, when Korea’s use of industrial
robots surged and Japan’s industrial production increasingly moved abroad.
For policymakers, the first hurdle is to accept that change is coming.
Artificial intelligence, robotics, and automation have the potential to make just as
big a change, and the second hurdle may be to find ways to help the public prepare
for and leverage this transformation to make lives better and incomes higher.
Strong and effective social safety nets will be crucial, since disruption of some
traditional labor and social contracts seems inevitable.
But education and skills development will also be necessary to enable more people
to take advantage of jobs in a high-tech world.
And in Japan’s case, this also means a stronger effort to bring greater equality into
the labor force between men and women, between regular and non regular
employees, and even across regions so that the benefits and risks of automation
can be more equally shared.
Japan is still a leader in robot production and industrial use.
The country exported some $1.6 bn worth of industrial robots in 2016 more than the next five
biggest exporters (Germany, France, Italy, United States, South Korea) combined.
Source: IMF
23. The views expressed in Economic Capsule are not necessarily those of the Management of Commercial Bank of Ceylon PLC
The information contained in this presentation has been drawn from sources that we believe to be reliable. However, while we have taken reasonable care to maintain accuracy/completeness of the information,
it should be noted that Commercial Bank of Ceylon PLC and/or its employees should not be held responsible, for providing the information or for losses or damages, financial or otherwise, suffered in consequence
of using such information for whatever purpose.
< Research & Development Unit >