Mariano Rajoy en Bilbao. Imagen tomada por Iker Parriza (Photo credit: Wikipedia)
What has the Spanish government done until now? Well on the 11th of July prime minister Rajoy announced the following steps with the endorsement of the IMF.
The standard VAT rate was raised from 18 to 21 percent and the reduced rate from 8 to 10 (the super-reduced rate was left unchanged at 4 percent). A number of products have also been moved from lower to higher rates. Other indirect taxes will also be raised.
The extra payment in December to civil servants was suspended for 2012 – equivalent to nearly a monthly wage.
Unemployment benefit was reduced (with the replacement rate after six months falling from 60 to 50 percent).
Social security contributions are reduced by one percentage point in 2013 and a further point in 2014.
With a unemployment rate of 25% and 50% among the young there are plenty of issues to be confronted. However. There are little signs in the Spanish governments actions to suggest any efforts to stimulate new job creation or any investment that will take the country out of recession. It would seem that they only thing that they are capable of is digging the hole even deeper.
After years of two digit growth figures in China the economy is about to slow a bit down for what IMF believes will be a soft landing. The main drive for this change is the situation in Europe, which does not seem to improve anytime soon. However, the domestic Chinese market seems to be a driver.
The Öresund Bridge from underneath (Photo credit: Wikipedia)
It is quite amazing to see and hear what Institutional investors are communicating at the moment. For a long time it was their job to create more wealth for the people who had trusted their hard earned money into a few very well of funds. They invested freely in all kinds of projects and had portfolios that were very diversified (and some would say to diversified).
The first came the raise of the consumer activist who forced these huge investors to put in ethical screens that ensured that there was some form of consistency between the individual wishes and the investment targets. These pension funds have now taken a further step in the direction of creating a more sustainable investment platform by looking into projects that benefit the very society and people own them.
The financial and economic crisis means that public construction projects are on a diet, but now there are signs that there may be a tremendous boost on the way to the Danish infrastructure. A telephone survey done by a independent think tank, shows that the country’s ten largest pension and the state owned, ATP, are willing to invest nearly 60 billion kroner in the Danish infrastructure such as a harbour tunnel in Copenhagen, sewers or a large bridge between some of the main island of the country. According to calculations this will create 7,200 new Danish jobs annually over a period of 10 years when billions are invested in public works projects.
This means that there is cash then the government just need to provide the projects and vision needed to make it a reality.
Logo of A.P. Moller – Maersk Group (Photo credit: Wikipedia)
The worst CSR performer in the Maersk empire is forced to fire some 400 employees some really poor economic performance. While there is no direct link between their focus on sustainable business solutions and their bottom line, it is interesting to note that the this part of the business have not been able to adapt to the environment that they are operating in fast enough in order to avoid these colossal looses.
The company presented their first quarter results a few weeks ago and the Line devision was a overall looser draging the stock down for the whole company. One of the main contributors have been the price war on freight rates and very high fuel prices. These factors have subsequently send the container shipping line down with a deficit in the first quarter of 3.4 billion against a profit during the same period a year earlier to 2.5 billion. Maersk Line has already set the price to transport containers between Europe and Asia up but this will not mean that the shipping devision will present black numbers this year. Maersk Line is the world’s largest container shipping company and is responsible for 42 percent of revenue in the conglomerate AP Moller-Maersk.
The apple story seem to continue to fascinate people and professionals. Even though that Foxconn is not only producing products for Apple that have become the all-time favorite when it comes to poor ethics management and lack of efficient control systems.
It is quite interesting that people can disregard corporate behavior if the brand of a company is strong enough. Most of my own students use Apple products and they are never surprised when I talk about the ethics record of the company. However, this knowledge does not seem to change their willingness to buy their products. Maybe because there is a wide consensus that most of the production facilities making hardware products in China are more or less branded as being in violation of Labour and Human Rights it does not hit Apple as hard. So while we know that Apple is in violation of these Rights at least we know what they are doing and at least it gives us some idea about their actions.
I received this quite informative infographic from Tony Shin, which I think highlight the case quite good. I know that some of my friends that specialize in Chines working conditions would regards some of theses issues as being quite “normal” and not really seen as a big issue inside China. However, the infrographic from Tony does give a opportunity for customers to gain knowledge about how their consumer goods are produced.