From The Kathmandu Post: The International Finance Corporation has received permission from the government to issue Nepali currency bonds in international markets but will have to reinvest the capital collected back in Nepal for at least three years. The private sector lending arm of the World Bank Group got approval from the Cabinet to issue Nepali currency bonds worth $20 million outside Nepal in November last year. This is the first time an international agency has been granted approval to issue Nepali currency bonds in international markets.
Some conditions:
1. The IFC cannot return the invested money before three years.
2. It will have to deposit the capital within three months from the date the bonds are issued.
3. The amount should be invested in the productive sector, such as industry, infrastructure and tourism, among others
The IFC will hedge the foreign exchange risks through the private sector window of the International Development Association, also an arm of the World Bank Group. The IFC has yet to state the interest rate at which the bonds will be issued. But the central bank has suggested that the Finance Ministry decide the interest on investment through microfinance institutions at not more than 8 percent.
Govt plans to cut spending to curb fiscal deficit
From livemint: India's government is likely to cut spending for the current fiscal year by as much as 2 trillion Indian rupees as it faces one of the biggest tax shortfalls in recent years, three government sources said.
The government has spent about 65% of the total expenditure target of 27.86 trillion rupees till November but reduced the pace of spending in October and November, according to government data. A 2 trillion-rupee reduction would be about a 7% cut in total spending planned for the year. In October and November, government spending increased by 1.6 trillion rupees, nearly half the 3.1 trillion it spent in September. The fiscal year starts April 1 and ends March 31. Lack of demand and weak corporate earnings growth in the economy led to lagging tax collections this year. Analysts said growth will be hurt.
The government is likely to keep the fiscal deficit under 3.8% of gross domestic product, sources said, while letting it slip from its earlier set target of 3.3% for the year.
Globalization in transition: The future of trade and value chains
From McKinsey.com: Although output and trade continue to increase in absolute terms, trade intensity (that is, the share of output that is traded) is declining within almost every goods-producing value chain. Flows of services and data now play a much bigger role in tying the global economy together. Not only is trade in services growing faster than trade in goods, but services are creating value far beyond what national accounts measure. Using alternative measures, we find that
From livemint: India's government is likely to cut spending for the current fiscal year by as much as 2 trillion Indian rupees as it faces one of the biggest tax shortfalls in recent years, three government sources said.
The government has spent about 65% of the total expenditure target of 27.86 trillion rupees till November but reduced the pace of spending in October and November, according to government data. A 2 trillion-rupee reduction would be about a 7% cut in total spending planned for the year. In October and November, government spending increased by 1.6 trillion rupees, nearly half the 3.1 trillion it spent in September. The fiscal year starts April 1 and ends March 31. Lack of demand and weak corporate earnings growth in the economy led to lagging tax collections this year. Analysts said growth will be hurt.
The government is likely to keep the fiscal deficit under 3.8% of gross domestic product, sources said, while letting it slip from its earlier set target of 3.3% for the year.
Globalization in transition: The future of trade and value chains
From McKinsey.com: Although output and trade continue to increase in absolute terms, trade intensity (that is, the share of output that is traded) is declining within almost every goods-producing value chain. Flows of services and data now play a much bigger role in tying the global economy together. Not only is trade in services growing faster than trade in goods, but services are creating value far beyond what national accounts measure. Using alternative measures, we find that
- Services already constitute more value in global trade than goods.
- All global value chains are becoming more knowledge-intensive.
- Low-skill labor is becoming less important as factor of production.
- Contrary to popular perception, only about 18 percent of global goods trade is now driven by labor-cost arbitrage.
- Growing demand in China and the rest of the developing world, which enables these countries to consume more of what they produce
- Growth of more comprehensive domestic supply chains in those countries, which has reduced their reliance on imports of intermediate goods
- The impact of new technologies
