Politics

Even a „soft“ Brexit does not let the economy take off

  The global economy is in difficult waters. Growth has not been as weak as it has been since the financial crisis of 2008/2009. In its current analysis, the International Monetary Fund estimates it at only 3.0 percent for the current year, more than half a percentage point less than last year. There is certainly a risk that things will get even worse. Namely, if one of the risks that have already been weighing on the global economic climate for some time, and above all on companies‘ willingness to invest, should worsen further. Fortunately, the two most important issues have not looked like this in recent days. The United States and China seem to be moving more in the direction of (partial) compromises in the trade conflict. It is becoming increasingly clear that the mutual protectionist measures are damaging not only China, the world champion exporter, but also American industry….

Erdogan’s campaign in Syria has consequences

Surprisingly, the Turkish army’s offensive in northern Syria, which began last week, is not coming. For months, President Erdogan has announced his intention to establish a buffer zone on Syrian territory at the Turkish border. So far the terrain has been controlled by Kurdish militias, the Democratic Forces of Syria (SDF). In Turkey’s eyes, this group is a terrorist organisation. The invasion of Turkish troops was only made possible by the withdrawal of the most important ally of the SDF. US President Trump recently surprisingly announced the withdrawal of the remaining military members of his country from northern Syria. Not only the Kurds considered this announcement a stab in the back, even in the USA there was much criticism of Trump’s actions. For President Erdogan, domestic political motives might play a role in the campaign. After the poor performance of his AKP in the local elections in spring as well…

New customs dispute between USA and EU: this could become expensive in the end

The US government has announced the introduction of new punitive tariffs against the EU. This time it is about „retaliatory tariffs“, which have even been explicitly approved by the World Trade Organisation (WTO) because of the banned EU subsidies for the aircraft manufacturer Airbus. Customs duties on goods worth 7.5 billion euros are due to come into force in mid-October. The volume corresponds to the WTO decision, but the list of products subject to tariffs published by the US Department of Commerce came as a surprise. It is clear that the countries with Airbus production sites that are responsible for the subsidies in question will also be affected by the US tariffs. These are essentially France, Germany, the UK and Spain. Although passenger aircraft are on the list as expected, they are only subject to a tariff rate of 10%. Aircraft parts or helicopters, on the other hand, are exempt…

Portugal: ruling party wins parliamentary elections

The current prime minister and socialist leader in Portugal, António Costa, can be declared the winner of yesterday’s parliamentary elections. This should continue and even strengthen the political stability. According to the preliminary results, Costa’s Socialists (PS) with 106 seats will be the strongest faction in the Lisbon unicameral parliament (Assembleia da República). Compared to the last election in 2015, the PS also achieved the highest gain with 20 additional seats. Second place went to the strongest opposition, the conservative Social Democrats (PPD/PSD), who were voted out of office in the previous parliamentary elections. With 77 seats in the Assembleia, they had to cope with significant losses. In third and fourth place were Costa’s previous allies, the Left Bloc (B.E.) with 19 seats and the Ecocommunists (PCP-PEV) with 12 seats. Unlike in large parts of Europe, right-wing populists played no role in the elections. The outcome of the parliamentary elections…

Climate protection and sustainability – everyone wants to be there

Climate protection and sustainability are issues that currently dominate the public debate and also influence the capital market. The ESG formula broadens the perspective of the issuer view and green bonds broaden the investment spectrum in the sense of the „mega topics“ mentioned above. Green bonds are part of the view that the capital market must place greater emphasis on the sustainability factor, both on the issuer side and on the investor side. When is a bond green? The key to answering this central question lies first and foremost in the use of the funds raised with the bond. Green bonds are primarily used to finance or refinance new or existing projects in the field of environmental and climate protection. It will be difficult to avoid a certain ‚definitional breadth‘ when determining what suitable ecological projects are. However, in order to support an efficient and expanding Green Bond market through…

Italy remains faithful and follows the Governing Council of the ECB

The new Italian government is planning a budget deficit of 2.2% for 2020. This is more than the targeted 2.04% this year. The expansionary budget is expected to bring the growth rate of economic output to 0.6% in the coming year, after a planned 0.1% this year. The 2020 draft budget contains a number of expansionary measures. The government is planning relief for the lower income brackets and an investment programme for environmental protection. Moreover, the VAT increase originally planned and agreed for the beginning of 2020 will not be implemented. To cover the additional expenditure, savings are to be made in various areas, proceeds from privatisation and proceeds from the fight against tax evasion. Ultimately, however, this is not enough to reduce the deficit. Another problem remains, as the debt ratio is expected to rise to over 135% of GDP this year and to decline slowly in the coming…

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