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Wednesday, 15 January 20
PREDICTIONS FOR 2020: 'SLOWBALISATION" IS THE NEW GLOBALISATION - PWC
 Projecting what the future holds is an important exercise for businesses looking to plan ahead. Below we present a summary of some of the themes we assess will likely prevail in the global economy in 2020.
Trading goods across borders will likely remain tense…: A defining feature of the global economy since at least the 1970’s has been globalisation—the bringing together of economies predominantly via more liberal trade flows. The global volume of merchandise traded slowed down dramatically and even went in reverse in 2019 in contrast to a 21st century average growth rate of about 3.4% per annum*. Also, in December 2019 the World Trade Organization’s (“WTO”) dispute settlement mechanism was effectively disbanded. We expect this trend to continue in 2020 and for trade tensions in the global goods market to persist. This means that we assess globalisation is likely give way to ‘slowbalisation’ i.e. continued integration of the global economy via trade, financial and other flows but albeit at a significantly slower pace. Large businesses with sophisticated supply chains spread across the world should therefore plan for a variety of scenarios, some of which have not been experienced in recent history.
…but global services trade expected to hit US$7 trillion: One aspect of trade that is often neglected is trade in services, which is now about one third of the size of the global volume of merchandise trade. In contrast to goods, services remain largely unaffected from tariff wars. The latest 2018 data from the International Trade Centre (“ITC”) shows that the global export of services was worth about US$5.8 trillion, or around 3.5% of global GDP. We expect the total value of services exported to hit a record US$7 trillion by 2020. Assuming historic trends continue, the US and UK are likely to remain the first and second largest exporters of services in the world in US Dollar terms. But in yet another reminder of the shift of the centre of economic power from the West to the East we expect China to overtake France in 2020 and become the world’s fourth largest services exporter.
Global economy is expected to grow at a modest pace: Figure 1 shows that growth in merchandise trade flows and the global economy have been intrinsically linked. In our main scenario for 2020, we expect the global economy to expand at a rate of around 3.2% in purchasing power parity (“PPP”) terms which is below the 21st century average of 3.8% per annum. In our main scenario, we expect all of the major economies to grow, buoyed, in part, by accommodative financial conditions. US economic activity is likely to expand by around 2%, in line with its potential rate. Given the historically low unemployment rate, US employers, however, find it increasingly difficult to hire staff. Across the pond, the Eurozone is expected to grow at approximately half that rate (i.e. around 1%). Germany, and other economies that are sensitive to global trade flows, to become more reliant on household consumption as a source of growth instead of net exports and investment. For Germany, however, this could be challenging as households tend to save more than the European average. In the emerging world, we expect the Chinese economy to expand by less than 6%– but it can still add the equivalent of Saudi Arabia to the world economy in one year. The world’s six other largest emerging economies, including Turkey, should also grow in this scenario, with India leading the way.
Predictions for 2020
More jobs across the board but not necessarily spread equitably
We expect the G7 to continue to create jobs, to the tune of around 2 million. Four out of the five new jobs in the G7 will be created in the US, UK and Japan. As the pool of labour resources in the G7 gradually dries up, we assess earnings should continue their upward trajectory. But in the absence of productivity improvements, corporate profit margins could be squeezed. Similarly, the International Labour Organization (“ILO”) expects the seven largest emerging economies– the E7–to create about 8 million jobs in net terms. There are some exceptions to this– Russia and China are likely to experience a shrinking workforce because of demographic pressures. Finally, the ILO’s employment projections for the G7 show that jobs are likely to be taken up by men and women in equal measure. Within the E7, however, the ILO expects job creations to be less evenly distributed across genders.
India expected to rise in global economic rankings
According to the IMF’s latest estimates, 2019 was the year when India overtook the UK and France to become the fifth largest economy in the world. This is an ongoing process with India likely on current trends to overtake Germany before 2025 and Japan before 2030 to become the world’s largest economy behind China and the US. France and the UK will likely now vie for sixth place in the rankings, with their relative position dependent on the value of the pound against the euro which may remain volatile in 2020.
Germany may need to choose between ‘lower for longer’ interest rates or higher fiscal spending
The US is expected to run a US$1.2 trillion government deficit. The Eurozone, which is about the same size as the US economy will run a government deficit about 1/10 the size of the US. In fact, we expect almost half of the Eurozone member states to run a government budget surplus in 2020. Cyprus, Luxembourg and Germany are expected to run the largest surplus relative to their economic size while France and Italy are expected to be on the opposite end of the spectrum with continuing budget deficits. Germany is likely to come under renewed pressure to either increase its government spending or accept ‘lower for longer’ interest rates (see Figure 3). Further afield, of the Gulf Cooperation Council (“GCC”) countries, we only expect Qatar to run a government surplus in 2020. This could mean more policy action in the future to balance government budgets across the GCC.
US oil production expected to hit record levels
Global renewable energy and nuclear consumption will likely make up more than 20% of global energy consumption, which is the highest it has ever been. The rise of renewable energy reflects how businesses, households and governments are adapting and changing their attitudes. China is expected to be the largest consumer of this type of energy closely followed by Europe. However, oil is expected to continue to remain the most preferred source of energy in 2020 for the world economy followed by coal and natural gas. The US and China will almost certainly remain the largest consumers of oil in the world in 2020. In so far as the extraction and supply of oil (and other liquid forms of energy) is concerned the US may surpass the monthly 13 million barrels per day (“b/d”) threshold. To set into context, in the US crude oil was extracted at a rate of 5.5 million b/d 10 years ago.
Global population biggest it has ever been but also the greyest
According to the United Nations (“UN”), In 2020, the world’s population is expected to reach 7.7 billion, which is around a 10% increase compared to a decade ago. China, India and SubSaharan Africa are expected to drive around half of the world’s annual population increase. At the same time, the number of people above the age of 60 globally is expected to surpass the one billion mark. China is expected to have a larger number of people above the age of 65 than all the six other largest emerging economies put together. This calls into question how policymakers respond to this trend and fund future health and social care. This could also be an opportunity for businesses in advanced economies, who have been dealing with such issues for decades. In relative terms i.e. the proportion of people above the age of 65 relative to the country’s entire population, Japan is expected to remain the ‘greyest’ country in the world and Niger is expected to be the youngest.
Source: PWC
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Wednesday, 12 June 24
CHINA ACCOUNTS FOR 16.3% OF AUSTRALIA'S COAL EXPORTS, FOLLOWED BY INDIA 14.4% - BANCHERO COSTA
Global coal trade has really picked up pace in recent months, and is now fully back to pre-Covid levels says Banchero Costa in its latest report.
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Wednesday, 12 June 24
LNG NEWBUILDING VALUES AT RECORD HIGH: 78 NEWBUILD ORDERS PLACED IN 2024, DOUBLING 2023 - VESON NAUTICAL
The number of LNG newbuilding orders have more than doubled from the same period last year where 34 orders were placed, compared to 78 in the first ...
Monday, 10 June 24
CHINA'S MAY COAL IMPORTS RISE 11% ON LOWER DOMESTIC OUTPUT - REUTERS
China’s imports of coal rose 11% in May from a year earlier, customs data and Reuters records showed on Friday, as lower domestic output this ...
Tuesday, 04 June 24
HOW DO WESTERN SANCTIONS ON RUSSIA IMPACT THE GLOBAL METALS, MINING AND COAL MARKETS - WOOD MACKENZIE
The geopolitical landscape for Russia, as a major supplier of various commodities, has undergone a dramatic transformation since the invasion of Uk ...
Friday, 22 March 24
CASE STUDY: DANGERS OF COAL CARGO - SKULD
Recently, a bulk cargo vessel carrying coal from South Africa to Singapore suffered a fatal accident, resulting in the deaths of three crew members ...
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Showing 21 to 25 news of total 6871 |
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- Siam City Cement PLC, Thailand
- Coalindo Energy - Indonesia
- Essar Steel Hazira Ltd - India
- Indo Tambangraya Megah - Indonesia
- Ind-Barath Power Infra Limited - India
- Toyota Tsusho Corporation, Japan
- Kideco Jaya Agung - Indonesia
- Ministry of Transport, Egypt
- The University of Queensland
- Mintek Dendrill Indonesia
- Electricity Generating Authority of Thailand
- Gujarat Sidhee Cement - India
- Vedanta Resources Plc - India
- Ministry of Mines - Canada
- Gujarat Mineral Development Corp Ltd - India
- Thiess Contractors Indonesia
- Eastern Coal Council - USA
- Coastal Gujarat Power Limited - India
- Grasim Industreis Ltd - India
- London Commodity Brokers - England
- Bhushan Steel Limited - India
- Bharathi Cement Corporation - India
- Bangladesh Power Developement Board
- Baramulti Group, Indonesia
- Jindal Steel & Power Ltd - India
- Attock Cement Pakistan Limited
- Romanian Commodities Exchange
- Coal and Oil Company - UAE
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sinarmas Energy and Mining - Indonesia
- LBH Netherlands Bv - Netherlands
- San Jose City I Power Corp, Philippines
- Chettinad Cement Corporation Ltd - India
- Georgia Ports Authority, United States
- Independent Power Producers Association of India
- European Bulk Services B.V. - Netherlands
- Global Coal Blending Company Limited - Australia
- Kobexindo Tractors - Indoneisa
- GVK Power & Infra Limited - India
- IEA Clean Coal Centre - UK
- Sindya Power Generating Company Private Ltd
- Salva Resources Pvt Ltd - India
- Posco Energy - South Korea
- Vizag Seaport Private Limited - India
- Global Green Power PLC Corporation, Philippines
- GMR Energy Limited - India
- Sree Jayajothi Cements Limited - India
- Bulk Trading Sa - Switzerland
- Malabar Cements Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Anglo American - United Kingdom
- Bayan Resources Tbk. - Indonesia
- IHS Mccloskey Coal Group - USA
- Sojitz Corporation - Japan
- Pipit Mutiara Jaya. PT, Indonesia
- Carbofer General Trading SA - India
- Vijayanagar Sugar Pvt Ltd - India
- Rio Tinto Coal - Australia
- Mjunction Services Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Lanco Infratech Ltd - India
- Formosa Plastics Group - Taiwan
- Port Waratah Coal Services - Australia
- Bukit Makmur.PT - Indonesia
- PNOC Exploration Corporation - Philippines
- Uttam Galva Steels Limited - India
- Dalmia Cement Bharat India
- Samtan Co., Ltd - South Korea
- AsiaOL BioFuels Corp., Philippines
- Heidelberg Cement - Germany
- TNB Fuel Sdn Bhd - Malaysia
- Australian Coal Association
- Merrill Lynch Commodities Europe
- Indika Energy - Indonesia
- Planning Commission, India
- Binh Thuan Hamico - Vietnam
- Videocon Industries ltd - India
- Orica Australia Pty. Ltd.
- Kaltim Prima Coal - Indonesia
- Maheswari Brothers Coal Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Indonesian Coal Mining Association
- Commonwealth Bank - Australia
- India Bulls Power Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Therma Luzon, Inc, Philippines
- Kartika Selabumi Mining - Indonesia
- Madhucon Powers Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Xindia Steels Limited - India
- Directorate Of Revenue Intelligence - India
- Australian Commodity Traders Exchange
- CNBM International Corporation - China
- Cigading International Bulk Terminal - Indonesia
- Chamber of Mines of South Africa
- Singapore Mercantile Exchange
- Straits Asia Resources Limited - Singapore
- GN Power Mariveles Coal Plant, Philippines
- Price Waterhouse Coopers - Russia
- Jaiprakash Power Ventures ltd
- Global Business Power Corporation, Philippines
- Alfred C Toepfer International GmbH - Germany
- Pendopo Energi Batubara - Indonesia
- Aditya Birla Group - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Sical Logistics Limited - India
- Wilmar Investment Holdings
- Deloitte Consulting - India
- Barasentosa Lestari - Indonesia
- Sarangani Energy Corporation, Philippines
- SMC Global Power, Philippines
- Kalimantan Lumbung Energi - Indonesia
- OPG Power Generation Pvt Ltd - India
- The State Trading Corporation of India Ltd
- Electricity Authority, New Zealand
- ICICI Bank Limited - India
- Tata Chemicals Ltd - India
- Energy Link Ltd, New Zealand
- TeaM Sual Corporation - Philippines
- Borneo Indobara - Indonesia
- Globalindo Alam Lestari - Indonesia
- SN Aboitiz Power Inc, Philippines
- Siam City Cement - Thailand
- PTC India Limited - India
- Sakthi Sugars Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Metalloyd Limited - United Kingdom
- The Treasury - Australian Government
- Star Paper Mills Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Intertek Mineral Services - Indonesia
- Petron Corporation, Philippines
- Semirara Mining Corp, Philippines
- ASAPP Information Group - India
- Meenaskhi Energy Private Limited - India
- Tamil Nadu electricity Board
- Kohat Cement Company Ltd. - Pakistan
- Neyveli Lignite Corporation Ltd, - India
- Thai Mozambique Logistica
- Aboitiz Power Corporation - Philippines
- Semirara Mining and Power Corporation, Philippines
- Altura Mining Limited, Indonesia
- Holcim Trading Pte Ltd - Singapore
- VISA Power Limited - India
- Renaissance Capital - South Africa
- Africa Commodities Group - South Africa
- Orica Mining Services - Indonesia
- Cement Manufacturers Association - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Parry Sugars Refinery, India
- Bhoruka Overseas - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Trasteel International SA, Italy
- Kepco SPC Power Corporation, Philippines
- MS Steel International - UAE
- Timah Investasi Mineral - Indoneisa
- New Zealand Coal & Carbon
- Power Finance Corporation Ltd., India
- GAC Shipping (India) Pvt Ltd
- Jorong Barutama Greston.PT - Indonesia
- Edison Trading Spa - Italy
- Medco Energi Mining Internasional
- Ministry of Finance - Indonesia
- Central Java Power - Indonesia
- Energy Development Corp, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- White Energy Company Limited
- SMG Consultants - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Maharashtra Electricity Regulatory Commission - India
- McConnell Dowell - Australia
- Manunggal Multi Energi - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Goldman Sachs - Singapore
- Antam Resourcindo - Indonesia
- Agrawal Coal Company - India
- Kumho Petrochemical, South Korea
- Oldendorff Carriers - Singapore
- PowerSource Philippines DevCo
- Iligan Light & Power Inc, Philippines
- Wood Mackenzie - Singapore
- Latin American Coal - Colombia
- Bhatia International Limited - India
- Banpu Public Company Limited - Thailand
- Bukit Asam (Persero) Tbk - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Parliament of New Zealand
- Miang Besar Coal Terminal - Indonesia
- Mercator Lines Limited - India
- Ceylon Electricity Board - Sri Lanka
- Marubeni Corporation - India
- Riau Bara Harum - Indonesia
- Interocean Group of Companies - India
- Standard Chartered Bank - UAE
- Makarim & Taira - Indonesia
- Simpson Spence & Young - Indonesia
- Savvy Resources Ltd - HongKong
- Central Electricity Authority - India
- Billiton Holdings Pty Ltd - Australia
- Meralco Power Generation, Philippines
- International Coal Ventures Pvt Ltd - India
- CIMB Investment Bank - Malaysia
- Rashtriya Ispat Nigam Limited - India
- Indogreen Group - Indonesia
- Bukit Baiduri Energy - Indonesia
- Ambuja Cements Ltd - India
- Minerals Council of Australia
- Indian Oil Corporation Limited
- Mercuria Energy - Indonesia
- South Luzon Thermal Energy Corporation
- Karaikal Port Pvt Ltd - India
- Economic Council, Georgia
- Eastern Energy - Thailand
- Larsen & Toubro Limited - India
- Gujarat Electricity Regulatory Commission - India
- Indian Energy Exchange, India
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