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Archive for the ‘Economy News’ Category

China reportedly has 211 million migrant workers last year, and this number will likely rise to 350 million by the year 2050, if the government’s economic policies have not changed.

A study conducted by the commission of family planning and population of China was reported by the official Xinhua news agency. Report said the number of migrants who moved from the inland area of China to the industrial areas in the eastern part of this year is smaller than expected, due to slowing demand for industrial goods caused by the global economic crisis. But, the report said again, overall, the trend of migrating population seeking employment into the region’s industry will not change. The report was issued following a series of strikes at factories in China, for the first time since the government opened the economy of China in the last 10 years. The beginning of this month, a factory that makes sophisticated electronic goods in southern China from 132 employees a raise dollars per month to 175 dollars, after labor activists said workers were forced to work beyond working hours and receive low wages. Honda car factory in China last month closed briefly because of disputes about wages, which finally forced the Honda to give some concessions to its employees.

Russia and the United States Government seek to establish economic relations after President Barack Obama rearrange the political ties between the two countries last year.

In connection with that effort, President Dmitry Medvedev will meet with Obama in Washington on June 24 after visiting Russia and the Silicon Valley of California to meet with leaders of the technology company Cisco Systems Inc.

Cisco Systems Inc., promise to dramatically increase investment in Russia. The two heads of state will also hold meetings with business leaders, such as Boeing Co. Chief Executive Officer Jim McNerney.

Since Obama asked rearrange political relationships with Russia last year, both countries have signed an agreement reducing the threat of nuclear weapons and agreed to enhance cooperation to the problem of Afghanistan.

Russia also supported the U.S. proposal of providing sanctions for Iran. Office of the President of Russia the Kremlin and the White House said the visit is an opportunity to encourage cooperation to the realm of business.

“The development of political relations and the latest safety issues quite well. We have our chance to create a parallel development in the economic field,” said Robert Hormats, Undersecretary of State for Economics, Energy and Agriculture, on June 17.

The value of trade transactions between the U.S. owner of the world’s largest GDP, and Russia, the largest energy exporter in the world, were reached U.S. $ 18.4 billion. Russian Economy Minister Elvira Nabiullina Russian said that figure does not reflect the potential relations between the two countries.

European Union officials and the IMF has approved the establishment of aid worth 1 trillion dollars to maintain the stabilization of global financial markets and prevent the crisis spreading to Greece other countries in Europe and destroy the euro exchange rate. (5.10)

European officials last week shocked after the euro exchange rate declined sharply against the dollar. Single currency in Europe on the day this past Dictionary decreased to the lowest level since March 5, 2009 date and then, in the position of 1.2519 dollars. Meanwhile, bond yields in Portugal and Spain tended to increase sharply.

These conditions have raised concerns that the potential for systemic impact on the financial sector in Europe and the world. Responding to the matter at the end of last week officials of the European Union, ECB, and IMF Committee held a meeting to discuss the current situation in the region.

The result of this meeting was the establishment of emergency funds worth 750 billion euros (962 billion dollars). This emergency fund is intended to fend off speculators attacks against the euro. They are also intended to avoid the Greek crisis spread to other countries in the European region. This decision has brought the euro rebounded from lows in the last 14 months.

Decision of the formation of an emergency fund worth 750 billion euros is far exceeded market expectations. Previously, the market predicts emergency funding only amounted to 500 billion euros. According to the Monetary Affairs Commissioner Olli Rehn EU and French Finance Minister Christine Legarde, forming a fantastic amount of aid funds is a real commitment from the EU to “defend” its currency.

According to analysts of the European Union steps to establish an emergency fund worth 750 billion euros is the right thing to do at this time. Chief Economic Marco Annunziata of UniCredit Group in London said that 750 billion euro figure is an awesome power. He believes that this amount would be sufficient in the process of stabilizing the market for short-term. Certainly this decision of the European Union currently has succeeded in reducing the risk of transmission of panic and crisis.

Previously, the steps that the EU has failed in reducing the fiscal crisis that struck Greece. As a result, last week the euro has decreased by 4.1%, biggest weekly decline since the collapse of Lehman Brothes. European stock markets also declined sharply, the largest in 18 months, Europe Stoxx 600 Index decreased by 8.8% weekly.

Establishment of emergency funds is reported to come from EU countries valued at 440 billion euros in loans and guarantees. Meanwhile the EU budget spent 60 billion dollars worth of donated funds and the IMF’s 250 billion euro. Nevertheless the IMF itself rejected an official statement stating a willingness to channel funds amounting to 250 billion euros in emergency funding the establishment of the European Union. IMF President Dominique Strauss-Kahn said the IMF’s approach is to the individual countries.

Positive comments on the establishment of emergency funds also came from Professor of Economics, University of California Barry Eichengreen. According to the European Union Eichengreen this step will give significant time to be able to improve conditions in the region without any disturbances that potentially damage the market panic.

In addition to the formation of this emergency fund the IMF and the European Union has approved the distribution of aid to Greece which has experienced a budget deficit reached 13.6% of GDP. A reward for such support Greece has committed to retain its previous policy of budget cuts which have sparked protests and riots in the country.

This week, the Asian currencies collapsed with the South Korean won and Philippine peso posted the biggest depreciation in one year is more affected by the debt crisis in Europe that encourages investors reluctant to hold risky assets.

The MSCI Asia-Pacific Index of regional shares for having the worst week since February 2009. Minister of Finance of Greece George Papaconstantinou acknowledged experiencing a lack of funds to pay maturing debts amounting to 8.5 billion euros (U.S. $ 10.8 billion) this month. Moody’s Investors Service said the fiscal crisis could threaten Europe Portugal, Spain, Italy, England and Ireland.

“Exchange and has a typical Asian currency risky assets, and now they face an aggressive selling actions. Asian currencies also had a harder blow than the emerging market for this region depends on external demand. That is, if there is a threat to global economy, investors will unleash the Asian currencies, “said minorities Uchida, a senior analyst with Bank of Tokyo-Mitsubishi UFJ Ltd., Tokyo.

The won weakened 4.1% to 1155.45 per U.S. dollar during the week and the peso 2.4% to 45.535 depressed. Malaysian Ringgit also declined 2.7%, biggest since the U.S. dollar-peg in 2005. Indonesian Rupiah weakened 0.1% to 9225 per dollar yesterday. Bank of Indonesia may have entered the market for intervention that has limited the decline in the week amounted to 2.4%.

The Deputy Governor of Bank of Indonesia ensures a stable of Indonesia Rupiah level and there are no plans to implement the system of capital controls.

Indian rupee also weakened yesterday and suspected central bank intervention after touching its lowest level in two months 45.725 per U.S. dollar. Throughout this week, the rupee weakened 2.5% to 45.4800.

In Taiwan, market participants said the central bank sells domestic currency at the last minute to push the depreciation of trading yesterday. Taiwan dollar weakened 1.4% this week to NT $ 31.85 per U.S. dollar.

While for the Singapore dollar, weakened 1.9% to S $ 1.3933 this week and the Thai baht remained unchanged at 32.35.