World Bank Supports a Reform at Finance Ministry of Lebanon

The World Bank Tuesday approved a $5.2 million loan to support Lebanon’s Finance Ministry in fiscal policy and debt management as part of the Second Financial Management Reform Project. The project aims to enhance the efficiency of financial management systems and promote effective use of public resources in Lebanon, the World Bank said in a statement.

Read more: http://www.dailystar.com.lb/Business/Lebanon/2014/Apr-16/253441-world-bank-supporting-reform-at-finance-ministry.ashx#ixzz2z6011Fui (The Daily Star :: Lebanon News :: http://www.dailystar.com.lb)

U.S., Russia Trade Sanctions Over Crimea

By Carol E. Lee , Gregory L. White and Jared A. Favole, The Wall Street Journal 2014-03-25

The U.S. raised the stakes Thursday in its confrontation with Russia over Crimea, aiming a new round of sanctions closer to Russian President Vladimir Putin and his inner circle even as Moscow struck back with penalties of its own on U.S. lawmakers and White House officials.

The Obama administration’s more aggressive move—targeting a high-profile Russian bank as well as some of Mr. Putin’s wealthiest and most influential supporters—increased the likelihood the retaliation could spiral.

It also marked a notable reversal for a White House that until last month saw Mr. Putin and his government as a vital international partner.

Moscow has vowed an “asymmetrical” response that could encompass global issues important to the U.S., such as the Iran nuclear talks. U.S. officials said earlier that they were prepared for a Russian move to constrict supply routes used by the U.S. that pass near and through Russian territory.

Read Full Article on The Wall Street Journal »

Raising the Global Free Trade & Other Benefits of Business Globalization

Guest Post by Hilary Smith

You may also find more of her writing at SmartVirtualPhoneNumber.com.

When we first think about IKEA, H&M, Shell and other large corporations like these, what do they all have in common? Internationalization.

When growing up, this word was pretty big, but now that we have the internet, the way we do business has been completely redefined, and had enabled nearly everyone with a great product or service to sell it on a global level.

Why is globalization being discussed so much today? It might be simply due to the fact that it has a lot to offer. In addition to the potential for growth, many businesses take themselves to a global level for the first-mover advantage, which is essentially is being the first to get into a specific market and gain all the benefits from being the first.

Let’s take a closer look into some of the other significant benefits of globalization:

New Markets

The possibility for sales in more countries increases drastically because it’s now feasible to send the product to those countries. Logistically, it didn’t make sense for a small-company in Vancouver to send its products to Chile. It just cost too much to do it. But a rapidly globalizing market now has the freedom to exchange goods at will, because the demand is there. Many archaic travel restrictions have been removed, allowing people to travel and become acclimated to different cultures.

Furthermore, these ever-expanding markets of our day have significantly helped countries to raise capital in terms of foreign domestic investments. And as a result, the economy of that country improves.

Cheaper Materials

Small companies handcuffed by high costs for materials now have cheaper options available to them, as they can source needed raw materials, supplies and services locally. This saves businesses money, and allows them to appropriate those funds for different purposes, like hiring new employees, or expanding their company to reach different areas.

Look at it from the opposite perspective: Company A can now offer their product to Company B at a lower rate than Company B is used to. Increased sales allows the new provider to allocate their funds differently. Both of the companies, in this example, win.

Easier Transportation

Quicker, more accessible transportation means that products get to where they need to be in record time, leading to increased consumer satisfaction and money saved. It also means that companies can offer their product to newer markets more reliably, boosting sales at a fraction of the cost it would have just a few years before.

Increased Employment

All this money saved leads to more employment opportunities, and that leads to increased demand for newer, more expensive products.

Think about when you landed your first job. What did you do when you got that first paycheck? You probably went out and bought something. An increase in employment leads to an increase in sales, creating an economic stimulus effect that benefits all parties: the employer, the employee, and the company who is selling the employee that new pair of sunglasses.

The Information Age

The rise in the popularity of the internet has boosted the amount of information that is more easily accessible. Research inevitably saves businesses money because it finds alternative, cheaper ways to spend money, resulting in–you guessed it– more ways to allocate funds to increase business.

Technology and the internet lets businesses advertise in different ways than they had before, and it lets the communicate to potential customers like never before.

Forbes: The World’s Top 50 Microfinance Institutions

Whole Article available at FORBES

Instead of merely writing a check (then writing it off), why not make a tidy profit from a short-term, high-interest loan, most for under $200, so that a Mexican seamstress may buy a new sewing machine? Or so a Moroccan farmer can buy chickens so he may sell more eggs? Billionaires, global leaders and Nobel Prize recipients are hailing these direct loans to uncollateralized would-be entrepreneurs as a way to lift them out of poverty while creating self-sustaining businesses.
That promise has had a magnetic effect on private capital sources. Microfinance funding from private investors more than tripled to $2 billion in 2006. The field has attracted sterling banks and fund managers, including Citigroup , blue-chip venture capitalists like Sequoia Capital, tycoons like eBay founder Pierre Omidyar and Oscar-winning screen stars such as Robert Duvall–they’ve all joined the chase for returns in microfinance. Today, there are upward of 12,000 microfinance institutions issuing loans.
To help investors parse them, Forbes compiled its first-ever list of the Top Microfinance Institutions. We scoured 2006 data from the Microfinance Information Exchange, as well as analysis from ratings firms Micro-Credit Ratings International Limited and MicroRate, to rank the top 50 microfinance institutions (from a field of 641 reporting microfinance providers) by examining six key variables: gross loan portfolio, operating expense, operating expenses divided by the average number of active borrowers as a percentage of gross national income per capita, the outstanding balance of loans overdue by more than 30 days as a percent of gross loan portfolio, return on assets and return on equity. Each microfinance institution earned scores in four equally weighted categories–scale, efficiency, portfolio risk and profitability. Rankings were then based on the combined average score of those four categories.
To earn a spot on our ranking, the institution must have had audited financial statements for 2006 or submitted these for 2005, with the intention of providing audited 2006 results when available. Note that our rankings attempt to measure financial performance, not the social benefits of any microfinance institution.
Even the least credit-worthy Americans might gasp at the high rates of interest to which recipients of microfinance loans are subjected–as much as 85% isn’t unusual. But veteran microfinance experts are quick to remind scoffers about the typical alternatives–a village moneylender who might charge interest rates three or more times as high.
As is the case for any “hot” investment vehicle, investors should exercise prudence when jumping into the arena. Fly-by-nights aren’t uncommon in this new market. Supporting the wrong microfinance outfit may fail to reduce poverty or produce financial returns. Check out the essay by Morgan Stanleyexecutive Ian Callaghan on the perils of hunting for microfinance investments.
Our microfinance package also includes fresh commentary from Elizabeth Littlefield, a senior World Bank official, who discusses public vs. private funds flowing to this trendy niche. Michael Chu, a veteran private-equity investor in microfinance and Harvard Business School professor, argues why lending to the poor shouldn’t involve self-sacrifice. And legendary actor Robert Duvalland his wife Luciana Pedraza give an exclusive interview to the Forbes Video Network on their work on behalf of microfinance in Latin America.

Country Overview: Taiwan Economy

During the first two quarters of 2012, Taiwan’s economic growth rates reflected the sluggish global economic growth and the resulting weak external demand. The economic growth rate in the first quarter of 2012 stood at 0.5 %, turning negative during the second quarter (-0.1 %). However, as external demand gradually stabilized in the second half of the year, the economy picked up steadily with growth rates of 0.7 % in the third quarter and 3.9 in the fourth quarter.

For the total of 2012, the GDP growth rate was 1.3 %. In line with the global economic slowdown, exports decreased by 2.2 %, while imports shrank by 3.8 %. Despite the adverse impact of the lackluster global economy, labour market conditions continued to improve, leading to an unemployment rate of 4.2 %. Consumer prices increased by 1.9 % due to climbing energy and food prices. For 2013, the DGBAS (Directorate-General of Budget, Accounting and Statistics) forecasts an economic growth of 2.4 % for the whole year.

Economic growth

During the first two quarters of 2012, Taiwan’s economic growth rates reflected the sluggish global economic growth and the resulting weak external demand. The economic growth rate in the first quarter of 2012 stood at 0.5 %, turning negative during the second quarter (-0.1 %). However, as external demand gradually stabilized in the second half of the year, the economy picked up steadily with growth rates of 0.7 % in the third quarter and 3.9 in the fourth quarter.
For the total of 2012, the GDP growth rate was 1.3 %. In line with the global economic
slowdown, exports decreased by 2.2 %, while imports shrank by 3.8 %. Despite the adverse impact of the lackluster global economy, labour market conditions continued to improve, leading to an unemployment rate of 4.2 %. Consumer prices increased by 1.9 % due to climbing energy and food prices. For 2013, the DGBAS (Directorate-General of Budget, Accounting and Statistics) forecasts an economic growth of 2.4 % for the whole year.

Foreign Trade

In 2012, total trade amounted to US$ 571.6 billion. Exports in 2012 stood at US$ 301.1 billion, a decrease of 2.2 % in comparison with 2011, whereas imports stood at US$ 270.4 billion, a 3.8 % decrease in comparison with 2011. From January to May 2013, exports increased by 1.1 %, while imports recorded a modest decrease of 0.9 %.
Looking into more detail over the whole year of 2012, both exports and imports recorded the largest decreases in the first half of 2012, by 4.6 % and 5.9 % respectively, in comparison with the first half of 2011. According to the CEPD (Council for Economic Planning and Development), the contraction of exports was mainly the result of the slowdown of the world economy, in conjunction with weakened competitiveness in some domestic industries. In the second half of 2012, trade growth started to resume again, resulting in a 0.07 % export growth during this period. Import growth however decreased slightly by 1.7 % during the second half of 2012.

Mainland China remained Taiwan’s most important export market in 2012 with a share of 26.7 % of Taiwan’s total exports. On the 2nd place stood Hong Kong with a share of 12.5 %, followed by the US with a share of 10.9 % of total exports. Exports to the three main export partners decreased in 2012: -3.8 % for exports to China, -5.3 % for exports to Hong Kong, and a 9.3 % decrease for exports to the US. Exports to the ASEAN10 countries however, did not follow this negative trend and recorded even an increase of 9.7 % in 2012. Also in export share, ASEAN10 countries claim a high position in the rankings of Taiwan’s export partners, with exports from Taiwan to ASEAN10 equaling US$ 56.5 billion in 2012 , accounting for 18.8% of total exports. The EU27 is ranked after the US with an export share of 8.6 % of exports in 2012. Main export items in 2012 were: electronics (36.2 %), machinery (9.9 %), optical, photographic, precision and medical instruments (7.6 %), mineral fuels (7.1 %) and plastics (6.9 %).

Japan, mainland China and the US were the most important import partners of Taiwan in 2012, with shares of 17.5 %, 15.1 % and 8.7 % respectively. Imports from these top three import partners recorded decreases in 2012: -8.8 % (Japan), -6.1 (China), and -8.3 % (US). They were followed by ASEAN10 and the EU27, which commanded a share of 11.6 % and 8.3 % respectively. Main import items in 2012 were: mineral fuels (25.8 %), electronics (20.2 %), and machinery (9.8 %).

Because of the gap between exports (US$ 301.1 billion) and imports (US$ 270.4 billion),
Taiwan enjoyed a trade surplus of US$ 30.7 billion. Except for Japan, Taiwan has a trade
surplus with all its major trading partners. Due to the rapid increase of exports versus the
relative small decrease of imports in 2012, the trade surplus with ASEAN10 increased by 33.4%.

Investments Untitled

Sources: Bloomberg, Taipei Rep Office in EU