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Monday, 25 May 2015

Unit 4: African Free Trade Bloc

This is important news for growth and development in the African continent. One of the reasons for the very low rate of intra-regional trade in Sub Saharan Africa inn particular is the over-lapping nature of several trade blocs. It seems this is about to change.
CNBC Africa reports here that a new 26-nation free trade area is set to be established. With a combined gross domestic product of $1 trillion, the tripartite trade area will include the East African Community, the Common Market for Eastern and Southern Africa, and the Southern African Development Community in a single free market.
However much remains to be done to make this a reality not least finding agreement between African countries on non-tariff barriers such as rules of origin to guard against import dumping.
The aim is to create a new African Continental Free Trade Area (CFTA) by 2017.

Unit 4: Greece - The economy in pictures!

We often forget about the real impact of severe depression on an economy. This article from a journalist at Reuters illustrates in a striking way the damage that a persistent depression can have on the physical capital of a modern economy. 

Economists have a term for this - hysteresis - and a quick flick through this montage of images of abandoned factories reveals much about the long term scarring effects of an economy whose trend growth rate has collapsed.

Really sad, and a reminder that Economics is not about diagrams and theories, but real life and people!

Unit 4: Economic Development - Mozambique

Mozambique is a really interesting country to study from an economic development perspective. Some useful information for discussion in class. 
Rapid economic growth
In recent years it has experienced one of the fastest GDP growth rates in the world well in excess of 10 per cent per annum. Real GDP growth is forecast to slowdown to 7% in 2015 as a result of severe floods in the north of the country last January which impacted agricultural output and transportation. This emphasises the vulnerability of low income countries to the effects of volatile weather patterns linked directly to the effects of climate change.
High dependency on farming, coal and (in the future) natural gas
At the heart of their recent growth has been surging coal production and new investment in natural gas and infrastructure. Annual growth in agriculture (which accounts for 80% of employment) and manufacturing remain below potential largely for structural reasons, including infrastructure constraints and an under-developed labour market.
Rapid growth has also contributed to relatively high inflation which is is set to be around 5% on average this year, with lower food and fuel prices balancing pass-through effects from the a depreciation of the Mozambique currency.
Inward investment
One of the major factors affecting Mozambique in recent years has been their top ranking for inward foreign direct investment within the African continent. Mozambique is forecast to receive around $5 bn in 2015, close to 30% of GDP, driven by investments in mining and gas. In spite of lower fuel prices, Andarko (US) and Eni (Italy) are hoping to start full-scale production of liquified natural gas (LNG) LNG in 2020 at the earliest.

Thursday, 21 May 2015

Unit 3: Banks fined for currency price fixing!

Thanks to both Mirza and Huzaifa for sending me this BBC link about overt collusion & price fixing amongst the major banks.

Click here for the article. It makes my blood boil!!!!!!!!

Wednesday, 20 May 2015

Unit 4: Deflation in the UK!

A timely piece of news came out of the UK yesterday.

Click here for the article on the latest inflation figures.

Some very useful analysis from the economics editors at the BBC.

Please try and read today so we can discuss in the lesson.

Saturday, 16 May 2015

Unit 2 & 4: Reducing the fiscal deficit.

Thank you to Aara for spotting this article.

Click here to access the Conservative policy to eradicate debt.

Useful when discussing the problems of reducing a deficit and the impact it may have on other objectives.

Wednesday, 13 May 2015

Unit 2 (& 4): Revision material

Thank you to Geoff and his team from tutor2u for these exam revision notes on macro-economics. Really useful stuff to give you the edge in this months examinations.