FocusEconomics Insights - Latest Posts
March 14, 2018
“Want is only one of five giants on the road of reconstruction, and in some ways the easiest to attack. The others are disease, ignorance, squalor and idleness.” So wrote economist William Beveridge in 1942, in his renowned UK government-commissioned report into citizens’ welfare.
Published in the dark depths of World War Two, at a time of morphing social attitudes, Beveridge’s work became a lodestar for those advocating a much more active role for the public sector in improving people’s lives. The Beveridge Report laid the foundations for the modern British welfare state and provided the ethos behind the establishment of the National Health Service (NHS), among the world’s first tax-funded healthcare systems to be completely free at the point of use.
More than 75 years later, the idea that governments should shoulder far greater responsibility for their citizens’ wellbeing has taken root the world over. Most countries now devote far more public resources to health than at any other time in history. Among OECD members, government spending on health accounted for 7.7% of GDP in 2014 (the most recent year for which data is available), up from a negligible amount in the middle of the last century. OECD health spending per head has on average risen over 70% since the early 1990s.
Newly-elected Chilean President Sebastian Piñera faces a myriad of challenges - economic and otherwise
March 1, 2018
Chile’s economy is gradually picking up after a prolonged period of subdued growth brought on by lower copper prices and stagnant investment. Business and consumer confidence have risen sharply in recent months, there are incipient signs of a turnaround in the construction sector and prices for copper are now back near multi-year highs. Against this macroeconomic backdrop, center-right candidate Sebastian Piñera is set to be sworn in as Chile’s new president on 11 March, having previously governed the country from 2010 to 2014. He has pledged to boost the country’s competitiveness, stoke growth and alter some of Michelle Bachelet’s key reforms—notably the reform of the tax system.
The challenges facing the incoming government are, however, considerable. Fiscal room for maneuver will be constrained by the not-insignificant structural budget deficit. Furthermore, the parliament is fractured, and lingering weaknesses in education, health and infrastructure must be tackled if Chile is to truly become a developed country—an often-stated aim of Piñera.
To discuss the country’s economic situation in more detail, we spoke to Alejandro Fernández Beros, Chief Economist at Gemines.
March 1, 2018
By Guest Author: Professor Arthur S. Guarino, MBA, MSSc, JD, Rutgers University
“When goods do not cross borders, soldiers will.” – Frederic Bastiat, French economist (1801-1850)
Trade protectionism is re-emerging as a controversial tactic among policymakers and economists in enhancing a nation’s economic well-being. Trade protectionism has been used with the intent of helping a nation recover from an economic downturn. However, in many instances the opposite effect occurred in which not just one but many nations suffered economic setbacks such as a recession or even a depression. In order to understand trade protectionism, it is necessary to know why it is done and what the effects are on an economy.
February 26, 2018
While it may be widely known that Latin America is the most unequal region in the world, what’s not so well known is that an enormous economic disparity exists between the different regions within Latin America. For example, it would take the Chocó region, the poorest area in Colombia, 200 years to reach Bogotá’s per capita income levels, according to an OECD study on Colombia published in 2015. In Latin America, individuals’ incomes in the various intermediate administrative divisions—department, province, state or region—are nine times higher in the richest than they are in the poorest.
February 22, 2018
We’re back with another post in our commodities explainer series. This time we take on coal, a commodity that has received a lot of attention in recent years; mostly negative attention because of its effects on the environment. Fossil fuels are referred to as dirty fuels for industrial purposes and power generation, and coal is thought to be the dirtiest of them all. With so much attention placed on the environment in recent years, largely due to the climate change issue, coal has taken much of the flack. Nonetheless, coal is projected to continue to be produced and consumed at a healthy rate in the next few decades despite its bad rap. In this post we give you a comprehensive overview of coal:
February 21, 2018
by Francisco Rodríguez, Chief Economist at Torino Capital LLC
Most parties in Venezuela’s main opposition coalition, the Democratic Unity Roundtable (MUD), have decided to sit out the country’s May elections, according to public statements issued by some of the parties as well as the announcement made by MUD spokesperson Angel Oropeza on February 21, in which he said that they could not participate in a “fraudulent, illegitimate” presidential election unless electoral conditions change. 
Although Oropeza said that all parties that are part of the MUD signed the statement, more moderate sectors of the opposition appear likely to participate. At the present moment, the most probable scenario appears to be one in which President Nicolás Maduro will face an independent candidate supported by some minority parties, with the MUD calling on its supporters to abstain in the elections.
In this scenario, President Maduro will be facing an opposition field that will be split between abstentionists and those favoring participation. This is certainly one of the most favorable settings that the government could have hoped for and raises the possibility that Maduro could be re-elected for a second six-year term without overtly manipulating the vote count. On the other hand, we argue that given the results of recent opinion polls, there is also a significant probability that Maduro could lose the election on these terms.
In this discussion, we begin by exploring the rationale for the decisions taken by key actors and then go on to map the potential scenarios that could arise from the electoral results.
February 21, 2018
Gold production in many countries, especially in developing or emerging markets, has declined in recent years as the global economy has largely improved since the global financial crisis. Many mining operations have shut down or downsized significantly. However, prices have been increasing since 2016 as safe haven buying has increased. In part 3 of our series on gold, we begin with a section explaining why the price of gold has been fluctuating in recent years. This is followed by a section on the history and news on gold production in each of the top gold producing economies globally in 2017 according to the United States Geological Survey as well as the 2018 economic outlook for each according to the FocusEconomics Consensus Forecast.
February 6, 2018
It's been just over one year since President of the United States Donald J. Trump took office and what a year it has been. Are you curious what the next year has in store? We recently produced a new special report on the U.S. economy where we interviewed 95 economic analysts for their views on the state of the economy one year into the Trump presidency, and what they believe is in store for the coming years. Below you can find a sample of some of the quotes from the world renowned economic analysts that participated in the survey. You can also download the special report containing insight and analysis on key economic issues for free here.
February 2, 2018
China has been one of the fastest growing economies over the last few decades and is now the second largest economy in the world, just behind the United States. However, after years of astronomical economic growth, the economy is currently in the middle of a “managed” slow down, due in large part to Chinese authorities’ desire to avoid the economy overheating. So what is going on in China currently and what is in store for 2018? Head of Economic Research Ricard Torné reports.
February 1, 2018
Fresh off its best year of growth in over a decade, the outlook for the Eurozone economy appears brighter than ever. Unemployment is falling, confidence is sky-high and even the economies on the periphery are starting to show improvement. However, several challenges are still facing the bloc, including Brexit, divergences across labor markets and a lack of agreement on the next steps for the Union. Against this backdrop, we talked with Stephen Brown, European Economist at Capital Economics, about his view of the Eurozone economy.
Get a sample report showing our regional, country and commodities data and analysis.
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