ITF Transport Outlook 2015: Highlights

The International Transport Forum (ITF) of the OECD has published the Transport Outlook 2015. Gloconomy provides you insight in some of the highlights of the report.

• 7 of the top 10 ports for container traffic are in China
• Air passenger volumes growth in emerging regions outplaced growth in Europe and North America
• Atlanta still busiest airport in the world, followed by Beijing and London
• Dubai fastest grower with +15.2%
• China and India account for nearly 70% of the estimated global rail passenger transport
• Transition economies invest in rail whereas mature economies invest increasingly in rail

Read the full ITF Transport Outlook 2015 report >>

Yangtze River Delta could become dominant hub of China’s knowledge economy

According to research published in the Tijdschrift voor Economische en Sociale Geografie, the Yangtze River Delta is best positioned to become the dominant hub of China’s future knowledge economy. 


The article states that China’s spectacular economic growth has been spatially uneven, with much development occurring in eastern coastal areas.
In particular, three metropolitan ‘super-regions’ have become China’s most competitive knowledge-based economies, consisting of the Pearl River Delta, the Yangtze River Delta and the Bohai Gulf Region.
The research indicated that due to multi-dimensional advantages the Yangtze River Delta, incorporating the Shanghai metropolis, is best positioned to become the dominant hub of China’s future knowledge economy. 



Read the full article >>

Source: Tijdschrift voor Economische en Sociale Geografie – 2014, DOI:10.1111/tesg.12065, Vol. 105, No. 3, pp. 241–267.© 2013 Royal Dutch Geographical Society KNAG

100 Years Panama Canal

Panama celebrates that 100 years ago the Panama canal was opened. Despite this memorable anniversary, future success is far from secure. Competition emerges from the expanding Suez Canal and a possible second canal through Nicaragua.

Read the full article on The Economist >>

Sahara Forest Project

An exiting project in the desert of Qatar: the Sahara Forest Project. It uses solar energy and salt water to produce drinking water and grow vegetables and crops.

This fully self supporting environmental initiative can be the beginning of self supporting mechanisms for countries around the world. Enabling governments to feed and water their entire population. And become independent of traditional energy firms and patterns.

Visit the Sahara Forest Project website >>

Small Boost To Global Airlines Profitability

The combined net profit-margins of the global airline industry will rise to approximately $ 10.6 billion this year. This was announced by the International Air Transport Association (IATA) on Wednesday 20th of march.

New synergy as a result of consolidation and more efficient cooperation, improved economic prospects and more demand from the passenger and cargo market will spur the improved growth.

According to the IATA the majority of the profits will come from airlines from the Far East. Followed by North American firms and finally European airlines.

Read the full IATA press release >>

China Biggest Luxury Cars Market by 2020

China is steadily growing to become the world's biggest market for luxury cars. According to McKinsey, the Asian giant will have surpassed the United States by 2020.

Even though luxury car sales are expected to grow within the United States for the years to come, sales in China are and will continue to boom. Over the past decade, China's market for premium cars has grown 36 %. A year.

Government 
In the past this immense growth was spurred by government officials  Their numbers and budgets grew excessively and resulted in double digit growth for Western manufacturers like BMW and Audi.

Upper-class
Nowadays, government officials only make up one tenth of the Chinese luxury cars market. Still, demand is growing because of women and younger drivers coming from the new rapidly growing high income class.

Competitive car
Surprisingly, China itself is still not able to produce competitive luxury cars. Despite many joint ventures with Western firms and copying best R&D practices, China cannot, and probably will not be able to over the next decade, build a globally competitive car. 

Thus, there are plenty of opportunities for Western manufacturers to spur global profits despite their falling domestic demand. 

Rapid urbanization spurs growth in emerging markets

Rapid urbanization spurs growth in emerging markets. As a result the world's economic balance shifts towards the east and south. 

According to the McKinsey Quarterly, a consumer class with more than 4 billion people will be created by this trend in 2025. In 1990 this group comprised only one billion members. 

New Urban Areas
By 2025, half of this new consumer class will live in the emerging world cities. Together, these nearly 440 new urban areas will account for nearly 50% of the expected global GDP growth between 2010 and 2025.

Read the article: Unlocking the potential of emerging-market cities

Check out the interactive map with city specific highlights about these new economic hot spots in 2025 >>

How long can the Chinese growth last?

According to IMF economists Mitali Das and Papa N’Diaye, China's growth is about to reach a turning point.

Within a decade, higher labour costs and an aging population will result in diminishing returns on capital investments.

Abandoning the one-child policy and spurring innovation might be the key to turns things around.

Click here to read the full IMF working paper on China's growth >>

Dramatic Global Shift Of Economic Power

The global economic balance of power will shift dramatically over the next 50 years. Current world powers will fiercely loose ground to emerging economies. 

According to the latest OECD projections, the United States will cede it's place as the world's largest economy to China as early as 2016. And India will also surpass the current economic # 1 on the long term. 

G7
Put together, China and India will overtake the combined economies of the G7 nations. Traditional economic giants such as Japan and the European Union, will loose ground to emerging nations with younger populations, such as Brazil and Indonesia.

Explore the full OECD report >>

Four Reasons Why Africa's Economy Is Rising

There are four reasons why the economy of Africa is booming. According to two World Bank economists, the causes of Africa's new success are:

1. Africa has the right kind of population growth.
   
2. Rapid urbanization is creating efficiency gains and attracting capital.
   
3. Technological progress has a relatively larger impact on Africa than anywhere else, because of the low start base where the continent is coming from.
   
4. Governance and economic management by officials can improve, also from very modest beginnings.

To explore the complete reason's for Africa's sudden success, read the full story.

Read Economist article Bulging in the Middle >>

Is Factory Asia Finished?

The heyday of 'factory Asia' may be ending sooner than anyone has ever thought, according to The Economist.  

The article states that much of Asia needs to learn the lesson. Switch from an export-oriented production economy to service industries. 

Read the full article Now for the soft part >>

Africa Is Booming: 10 Things To Know

The African continent is booming. It is about to add millions more to it's labour force in this decade, creating perfect conditions for solid sustainable economic growth. However, this requires a change in development strategy acording to The Independent. 

The Independent published a list of 10 things we didn't knew about the African economy. Here are the highlights:

1. Africa is booming
   "Africa has been the second-fastest-growing region in the world over the past 10 years, with average annual growth of 5.1 per cent over the past decade, driven by greater political stability and economic reforms that have unleashed the private sector in many countries."
   
   
2. Africa is poised to have the largest labour force in the world
   "By 2035, Africa's labour force will be bigger than that of any individual country in the world, which offers the continent a chance to reap a demographic dividend, using its young and growing workers to boost economic growth."
   
   
3. African workers are better educated than ever before
   "Today 40 per cent of Africans have some secondary or tertiary education. By 2020, it will be nearly half."
   
   
4. Steady work is still hard to find in Africa
   "Only 28 per cent of Africans have stable, wage-paying jobs. To reap the benefits of its positive demographics and advancements in education, Africa needs to quickly create more jobs."
   
   
5. With a few reforms, massive job growth is within Africa's reach
   "The experience of other emerging economies shows that Africa could accelerate its creation of stable jobs dramatically. When they were at a similar stage of development as Africa today, Thailand, South Korea and Brazil generated jobs at double or triple the rate of Africa's."
   
   
6. Africa can become the world's bread basket
   "Africa has about 60 per cent of the world's unused cropland, providing it with a golden opportunity to simultaneously develop its agricultural sector and reduce unemployment. On current trends, African agriculture is on course to create 8 million wage-paying jobs between now and 2020."
   
   
7. It's often cheaper for Africans to buy goods made in China than those made at home
   "African manufacturing is declining as a share in most economies, and that needs to stop. Africa is on course to generate 8 million new manufacturing jobs by 2020 but could nearly double that tally if it can reverse this trend."
   
   
8. Nigeria's four largest cities still have only six shopping malls
   "Africa's rising number of consumers is already driving growth in retailing, but the sector could grow much faster. The potential of retail still goes largely unrealised: In Ethiopia, Egypt, Ghana and Nigeria, nearly three-quarters of groceries are bought in tiny informal outlets. If barriers to foreign players were removed and action was taken to boost the share of modern retail outlets, this industry could finally hit its stride."
   
   
9. Africa needs more than petrodollars
   "Mining, oil, and gas contribute significantly to Africa's GDP, but these sectors employ less than 1 per cent of the workforce. Africa needs a jobs strategy, not just a growth strategy. Countries need explicit programmes to create jobs, targeted at labour-intensive sectors that enjoy comparative advantage."
   
   
10. The future for Africa looks bright – but there's still a lot of work to be done
    
    More than 300 million Africans will remain in vulnerable jobs in 2020. And even if governments are successful at promoting job creation, the number will keep rising for at least another 20 years because the labour force is expanding so quickly.
    
    Africa's employment challenge is daunting, but it is not unique. Many other emerging markets have transformed their employment landscapes and made sweeping gains in economic growth, and with the right policies in place, Africa has the right ingredients to produce similar success. Africa may prove to be one of the next great global stories.

Source: The Independent

Switzerland Remains Most Competitive Economy

For the fourth consecutive year, Switzerland is the most competitive economy on the globe. This emerged from the annual Global Competitiveness Report 2012-2013.

The report by the World Economic Forum assessed the competitive landscape of 144 economies, providing insight into the drivers of their productivity and prosperity. Singapore maintained it's second position. Finland overtook Sweden as third. The Netherlands completed the almost all European top five.

Explore the full report here >>

The Secret of Singapore: Casino's

Singapore is among the fastest growing economies in the world. It's secret? Casino's.

According to the World Economic Outlook by the IMF, Singapore's economy grew 14.5 % in 2010. Only Qatar (+16.3) and Paraguay (+15.3) had higher growth numbers. Beside Singapore's traditional economic champion-sectors, it's industry and harbour, gambling became the third driving force behind the small state's economic success.

At first, the local population opposed the exploitation of gambling. But after the construction of two new casino's, hundreds of thousands of Asians came to Singapore. Resulting in additional profits of 5.8 billion dollars.

Singapore's success inspired Taiwan to legalise casino's on the small islands of Matsu and Kinmen, after the Chinese government announced that it's citizens will be allowed to travel alone to these destinations, instead of in the current group trips. This way, also Taiwan hopes to benefit from the fast growing, wealthy and gambling minded Chinese middle class. And thus copy the secret of Singapore.

Gloconomy 2012

eAtlas of Global Development

The World Bank has released an interactive version of the popular Atlas of Global Development. It allows users to map over 175 indicators for up to 200 countries.

Key themes include:

• foreign direct investment
• international trade
• food production
• population growth
• climate change

Go to the interactive e-Atlas of Global Development >>

Compact City Policies Compared

Is there a model that combines sustainable urban development and green growth? The recent OECD publication Compact City Policies: A Comparative Assessment attempts to tackle the issue.

The report came up with four key facts:

1. There is a global trend toward urbanisation that has environmental and economic impacts. By 2050, 70% of the world's population, and 86% in OECD countries, will live in urban areas.
   
   
2. The continuing growth of urban populations calls for a policy response that optimises land resources. Land consumption for built-up areas will increase more rapidly than the population in 30 out of 34 OECD countries.
   
   
3. Demographics have changed. For example, the elderly population has doubled over the past 60 years in OECD countries and tripled worldwide. Urban policies will need to be tailored to the specific needs of the population.
   
   
4. The impacts of global warming and increasing energy prices require new responses. The recent economic crisis has exacerbated the problem by reducing governments' abilities to invest in solutions such as new infrastructure.

Additionaly, the report made 5 recommendations in order to overcome the most prominent challenges and guide compact cities into sustainable development and green growth.

Read the 5 recommendations for green growth >>

Extra $175 Billion For Transport in Developing Countries

Over the next decade developing countries will receive over $ 175 billion extra of loans and grants to improve their transportation systems. This was announced by seven multilateral development banks at the Rio +20 summit.

According to Asian Development Bank President Haruhiko Kuroda “Rapid motorization is creating more congestion, air pollution, traffic accidents and greenhouse gas emissions, especially in developing countries.”

But additionally, mr Kuroda stated that  “Developing countries have the opportunity to leapfrog to a greener future of less motorization, shorter commutes, and more energy efficient transport systems.”

Solutions Available
And sustainable transport solutions are already available.  For example low-cost electric vehicles in the Philippines, urban metrorail systems in Viet Nam, bus rapid transit systems in Mongolia and Bangladesh, and inland waterway transport in the People’s Republic of China.

Therefore, the coaltion of development banks announced to scale up the support for transport in developing countries by $175 billion.

Read full article >>

Is South Africa Still The Gateway To Africa?

Last year South Africa was entered the famous BRICS club. This selection of important emerging economies already had Brazil, Russia, India and China as permanent members. But is South Africa's membership actually valid?

South Africa's economy is just a quarter the size of the smallest member India. It's population is little more than one third of the BRICS' least populous country Russia.

Continental Competitors
On it's own continent, Nigeria displays far more economic growth. Moreover, Nigeria's population of 158 million far exceeds that of South Africa (50 million) and so does Egypt (82 million). And finally, an increasing amount of foreign multinationals prefer to situate their sub-Saharan hubs in Ghana or Kenya, leaving South Africa empty handed.

So the question is: Does South Africa belong in the BRICS club?

Read the full article: South Africa, The Gateway to Africa? >>

China and Asian Development Bank Join Forces on Green Innovation

The Asian Development Bank (ADB) and China have agreed to start several innovative projects aimed to spur green growth. The new strategy is based on inclusive growth, environmentally sustainable growth and regional cooperation and integration.

It focuses on 'natural resources and agriculture; energy; transport; and urban development, with lending and technical assistance centered around new technology, green or social development, and enhanced synergies with regional cooperation and integration programs.'

Read full article from Asian Development Bank >>

New World Bank Data Book Helps Countries Value Natural Assets

The latest edition of The World Bank's The Little Green Data Book provides comprehensive data on countries’ natural capital. This includes agricultural land, forests, protected areas, water resources and for the first time oceans.

The book contains data on more than 200 countries. This information could help policymakers, communities and other stakeholders weigh the value of natural resources and their role in development.

Key findings:

• Overfishing: 85 percent of the world’s ocean fisheries are fully exploited, over-exploited or depleted, causing annual global efficiency losses of $50 billion.

• Pollution: excess nitrogen runoff from fertilizers has resulted in large ‘dead zones’ in the ocean, covering some 250,000 km2, an area the size of Great Britain.

• Habitat loss or conversion: an estimated 35 percent of global mangrove area has been lost or converted, approximately 20 percent of the planet’s coral reefs have been destroyed in the last few decades, with more than a further 20 percent being degraded, and 30 percent of sea grass beds have been destroyed.

Read complete Little Green Data Book >>

Source: The World Bank