IMF: Portugal’s recovery remains on track

imf_sealPortugal’s economic recovery remains on track in 2015, boosted by rising exports and consumption, together with a recent upturn in investment. This conclusion comes from the Executive Board of the International Monetary Fund (IMF). Real GDP expanded by 1.5 percent (year-on-year) in the first quarter, and is projected to increase 1.6 percent for the full year. Fiscal adjustment has slowed, meanwhile, with a structural loosening likely this year. Employment has declined in recent quarters, after increasing sharply from early-2013 through mid-2014, and the unemployment rate was at 13.7 percent at the end of March. Continue reading “IMF: Portugal’s recovery remains on track”

Beyond the Greek Impasse

By George Friedman

georgefriedmanThe Greek situation — having perhaps outlived the term “crisis,” now that it has taken so long to unfold — appears to have finally reached its terminal point. This is, of course, an illusion: It has been at its terminal point for a long time. The terminal point is the juncture where neither the Greeks nor the Germans can make any more concessions. In Greece itself, the terminal point is long past. Unemployment is at 26 percent, and more than 50 percent of youths under 25 are unemployed. Slashed wages, particularly in the state sector, affecting professions including physicians and engineers, have led to massive underemployment. Meanwhile, most new economic activity is occurring in the untaxable illegal markets. The Greeks owe money to EU institutions and the International Monetary Fund, all of which acquired bad Greek debts from banks that initially lent funds to Greece in order to stabilize its banking sector. No one ever really thought the Greeks could pay back these loans.

Continue reading “Beyond the Greek Impasse”

Job not finished for UK economy, OECD says

logooecd_enThe United Kingdom’s economy is projected to expand this year and next, but challenges remain to boost productivity and make future growth more inclusive, according to the OECD’s latest Economic Survey. The Survey, presented in London by OECD Secretary-General Angel Gurría and UK Chancellor George Osborne, says that annual growth in the UK rose 2.6% in 2014, the fastest among G7 countries, and is projected to be at the same rate this year. Continue reading “Job not finished for UK economy, OECD says”

Germany Emerges

By George Friedman

georgefriedmanGerman Chancellor Angela Merkel, accompanied by French President Francois Hollande, met with Russian President Vladimir Putin on Feb. 6. Then she met with U.S. President Barack Obama on Feb. 9. The primary subject was Ukraine, but the first issue discussed at the news conference following the meeting with Obama was Greece. Greece and Ukraine are not linked in the American mind. They are linked in the German mind, because both are indicators of Germany’s new role in the world and of Germany’s discomfort with it. Continue reading “Germany Emerges”

The New Drivers of Europe’s Geopolitics

By George Friedman

georgefriedmanFor the past two weeks, I have focused on the growing fragmentation of Europe. Two weeks ago, the murders in Paris prompted me to write about the fault line between Europe and the Islamic world. Last week, I wrote about the nationalism that is rising in individual European countries after the European Central Bank was forced to allow national banks to participate in quantitative easing so European nations wouldn’t be forced to bear the debt of other nations. I am focusing on fragmentation partly because it is happening before our eyes, partly because Stratfor has been forecasting this for a long time and partly because my new book on the fragmentation of Europe — Flashpoints: The Emerging Crisis in Europe — is being released today. Continue reading “The New Drivers of Europe’s Geopolitics”

George Friedman’s Top Five Events in 2014

By George Friedman

stratfor‘Tis the season to make lists, and a list shall be made. We tend to see each year as extraordinary, and in some senses, each year is. But in a broader sense, 2014 was merely another year in a long chain of human triumph and misery. Wars have been waged, marvelous things have been invented, disease has broken out, and people have fallen in love. Nonetheless, lists are called for, and this is my list of the five most important events of 2014. Continue reading “George Friedman’s Top Five Events in 2014”

Kotug and Smit to merge European towage

Kotug_logologoboskalisRoyal Boskalis Westminster N.V. (Boskalis) and Kotug International B.V. (Kotug) have signed a Memorandum of Understanding (MoU) to merge their European harbour towage operations. The companies will establish a 50/50 joint venture for this purpose, combining the European harbour towage activities of Smit, a Boskalis subsidiary, with the European harbour towage activities of Kotug. This merger is the concluding step in Boskalis’ strategy aimed at establishing regional partnerships for its harbour towage activities, as was previously done through Smit Lamnalco, Keppel Smit and most recently Saam Smit. By joining forces opportunities are created to achieve cost and market synergies as well as a more efficient capital structure. Continue reading “Kotug and Smit to merge European towage”

Viewing Russia from the inside

By George Friedman

georgefriedmanLast week I flew into Moscow, arriving at 4:30 p.m. on Dec. 8. It gets dark in Moscow around that time, and the sun doesn’t rise until about 10 a.m. at this time of the year — the so-called Black Days versus White Nights. For anyone used to life closer to the equator, this is unsettling. It is the first sign that you are not only in a foreign country, which I am used to, but also in a foreign environment. Yet as we drove toward downtown Moscow, well over an hour away, the traffic, the road work, were all commonplace. Moscow has three airports, and we flew into the farthest one from downtown, Domodedovo — the primary international airport. There is endless renovation going on in Moscow, and while it holds up traffic, it indicates that prosperity continues, at least in the capital. Continue reading “Viewing Russia from the inside”

What the Fall of the Wall Did Not Change

By George Friedman

georgefriedmanTwenty-five years ago, a crowd filled with an uneasy mixture of joy and rage tore down the Berlin Wall. There was joy for the end of Germany’s partition and the end of tyranny. There was rage against generations of fear. One fear was of communist oppression. The other fear was of the threat of a war, which had loomed over Europe and Germany since 1945. One fear was moral and ideological, while the other was prudential and geopolitical. As in all defining political moments, fear and rage, ideology and geopolitics, blended together in an intoxicating mix. Continue reading “What the Fall of the Wall Did Not Change”

Vueling to fly Rotterdam-Barcelona route

rtmairportSpanish airline Vueling announced it will fly between Rotterdam (RTM) and Barcelona (BCN) airports from April 2015. Flights will take place four times a week: on Monday, Wednesday, Friday and Sunday. Flights are already bookable at http://www.vueling.com. The Vueling flights come on top of those carried out by Dutch airline Transavia (of the Air France-KLM Group), that connect the two cities four times a week already. The frequency of Transavia’s flights will be increased to 6 or 7 per week during summer 2015. The abundance of cheap flights between RTM and BCN will contribute to the growing tourist and business links between the metropolitan area of Barcelona (5,4 million people and the capital of independence-minded Catalonia) and the metropolitan region of Rotterdam-The Hague (2,5 million inhabitants and combining the largest port on the Atlantic with the political capital of the Netherlands).

Madeira’s Shipping Register is EU’s fourth largest

sdmlogoBy the end of September, the International Shipping Register of Madeira (MAR) became the fourth largest international shipping register of the European Union, reaching the largest number of vessels since its creation. According to the Sociedade de Desenvolvimento de Madeira’s data, by the end of September of 2014, a total of 316 vessels was registered in MAR, 53 more than the total number registered at the end of 2013, a result which represents an extremely positive development for this sector of the International Business Centre of Madeira (IBCM). Continue reading “Madeira’s Shipping Register is EU’s fourth largest”

The Similarities Between Germany and China

By George Friedman

georgefriedmanI returned last weekend from a monthlong trip to both East Asia and Europe. I discovered three things: First, the Europeans were obsessed with Germany and concerned about Russia. Second, the Asians were obsessed with China and concerned about Japan. Third, visiting seven countries from the Pacific to the Atlantic in 29 days brings you to a unique state of consciousness, in which the only color is gray and knowing the number of your hotel room in your current city, as opposed to the one two cities ago, is an achievement. Continue reading “The Similarities Between Germany and China”

Germany Fights on Two Fronts to Preserve Eurozone

By Adriano Bosoni and Mark Fleming-Williams

stratforThe European Court of Justice announced Sept. 22 that hearings in the case against the European Central Bank’s (ECB) bond-buying scheme known as Outright Monetary Transactions (OMT) will begin Oct. 14. Though the process is likely to be lengthy, with a judgment not due until mid-2015, the ruling will have serious implications for Germany’s relationship with the rest of the eurozone. The timing could hardly be worse, coming as an anti-euro party has recently been making strides in the German political scene, steadily undermining the government’s room for maneuver. Continue reading “Germany Fights on Two Fronts to Preserve Eurozone”

The Origins and Implications of the Scottish Referendum

By George Friedman

georgefriedmanThe idea of Scottish independence has moved from the implausible to the very possible. Whether or not it actually happens, the idea that the union of England and Scotland, which has existed for more than 300 years, could be dissolved has enormous implications in its own right, and significant implications for Europe and even for global stability. Continue reading “The Origins and Implications of the Scottish Referendum”

Spain on the road to recovery, says OECD

logooecd_enSpain is emerging from a protracted recession, marked by a return to moderate growth and rising international competitiveness. Decisive banking and fiscal reforms, coupled with supportive monetary policy from the European Central Bank, have reduced financial tensions and improved public finance. But to ensure that the recovery is sustained and unemployment returns to much lower levels, full implementation of on-going structural reforms and further measures to improve productivity and competitiveness are now needed, according to the latest OECD Economic Survey of Spain. Continue reading “Spain on the road to recovery, says OECD”

Ukraine, Iraq and a Black Sea Strategy

By George Friedman

georgefriedmanThe United States is, at the moment, off balance. It faces challenges in the Syria-Iraq theater as well as challenges in Ukraine. It does not have a clear response to either. It does not know what success in either theater would look like, what resources it is prepared to devote to either, nor whether the consequences of defeat would be manageable. A dilemma of this sort is not unusual for a global power. Its very breadth of interests and the extent of power create opportunities for unexpected events, and these events, particularly simultaneous challenges in different areas, create uncertainty and confusion. Continue reading “Ukraine, Iraq and a Black Sea Strategy”

Europe’s Malaise: The New Normal?

By George Friedman

georgefriedmanRussia and Ukraine continue to confront each other along their border. Iraq has splintered, leading to unabated internal warfare. And the situation in Gaza remains dire. These events should be enough to constitute the sum total of our global crises, but they’re not. On top of everything, the German economy contracted by 0.2 percent last quarter. Though many will dismiss this contraction outright, the fact that the world’s fourth-largest economy (and Europe’s largest) has shrunk, even by this small amount, is a matter of global significance.

Continue reading “Europe’s Malaise: The New Normal?”

Borderlands: Hungary Maneuvers

By George Friedman

georgefriedmanI am writing this from Budapest, the city in which I was born. I went to the United States so young that all my memories of Hungary were acquired later in life or through my family, whose memories bridged both world wars and the Cold War, all with their attendant horrors. My own deepest memory of Hungary comes from my parents’ living room in the Bronx. My older sister was married in November 1956. There was an uprising against the Soviets at the same time, and many of our family members were still there. After the wedding, we returned home and saw the early newspapers and reports on television. My parents discovered that some of the heaviest fighting between the revolutionaries and Soviets had taken place on the street where my aunts lived. A joyous marriage, followed by another catastrophe — the contrast between America and Hungary. That night, my father asked no one in particular, “Does it ever end?” The answer is no, not here. Which is why I am back in Budapest. Continue reading “Borderlands: Hungary Maneuvers”

Top earners capturing growing share of total income in many countries, says OECD

logooecd_enThe share of the richest 1% in total pre-tax income have increased in most OECD countries over the past three decades. This rise is the result of the top 1% capturing a disproportionate share of overall income growth over that timeframe: up to 37% in Canada and 47% in the United States, according to new OECD analysis. Even in countries which have a history of a more equal income distribution, such as Finland, Norway and Sweden, the share of the top 1% increased by 70%, reaching around 7-8%. By contrast, top earners saw their share grow much less in some of the continental European countries, including France, the Netherlands and Spain. Continue reading “Top earners capturing growing share of total income in many countries, says OECD”

The U.S. Opts for Ineffective Sanctions on Russia

By George Friedman

georgefriedmanThe United States announced new sanctions on seven Russian government officials April 28. A long-used tactic, sanctions can yield unpredictable effects or have no effect at all, depending upon how they are crafted. It is commonly assumed that sanctions are applied when a target country’s actions are deemed unacceptable. The sanctioning nation presumably chooses sanctions to avoid war when war would be too costly or could result in defeat. Sanctions’ stated purpose is to induce behavioral changes in a target state by causing economic pain. To work, sanctions must therefore cause pain. But they must not be so severe that they convince the target state that war is more desirable than capitulating to the demands of the sanctioning nation.

Continue reading “The U.S. Opts for Ineffective Sanctions on Russia”

Port of Rotterdam in European LNG joint venture

portofrotterdamThe port authorities of Antwerp, Mannheim, Rotterdam, Strasbourg and Switzerland signed a joint venture for the introduction of LNG. This involves cooperation in research, promotion, knowledge transfer, legislation and bunker infrastructure. The agreements follow on from the LNG Master plan of the Rhine-Main-Danube corridor in which all participants are involved. The aim of this master plan is to put liquefied natural gas to full scale use as a fuel for inland shipping on the Rhine-Main-Danube corridor. Continue reading “Port of Rotterdam in European LNG joint venture”

OMA to design Axel Springer’s new media centre in Berlin

omaberlinOMA’s design for Axel Springer’s new media centre in Berlin has been chosen as the winner in the final round of a public design competition. The building will embody Axel Springer’s corporate shift from print to digital media, and will create a new hub in the existing Axel Springer campus in central Berlin. Mathias Döpfner, CEO of Axel Springer: “We are very happy to be able to build the new building of our publishing house together with Rem Koolhaas. He presented the conceptually and esthetically most radical model. The fundamental innovation of working environments will support the cultural transformation towards a digital publishing house.” Continue reading “OMA to design Axel Springer’s new media centre in Berlin”

Norway’s success in generating inclusive growth can ensure future prosperity

norgeflagThe Norwegian economy is performing well, generating inclusive growth, strong social mobility and low unemployment. But to ensure future prosperity, Norway must continue with growth-enhancing reforms while ensuring financial stability, according to the OECD’s latest Economic Survey of Norway. General Angel Gurría and Norway’s Finance Minister Siv Jensen, highlights how appropriate use of wealth from petroleum resources and counter-cyclical monetary policy insulated Norway from the worst of the financial crisis-induced recession and put it on a sound footing for recovery. Continue reading “Norway’s success in generating inclusive growth can ensure future prosperity”

P&O Ferrymasters extends LTL range by focusing on Germany

poferrymastersIn a further expansion of its pan-European LTL service, supply chain solutions specialist P&O Ferrymasters has introduced daily each-way trailer departures on the Benelux-Germany and  UK-Germany trade lanes. The company launched a similar daily service between the Benelux/Ruhr areas and Estonia in January.  Continue reading “P&O Ferrymasters extends LTL range by focusing on Germany”

Portugal economic recovery strengthening

portflagPortugal’s economic recovery is strengthening, the IMF reported. Led by investment and exports, economic growth is somewhat ahead of projections, employment is increasing, and the unemployment rate is continuing to decline from very high levels. GDP is now expected to rise by 1.2 percent in 2014—an upward revision of 0.4 percentage points—while unemployment is projected to decline to 15.7 percent — a downward revision of 1.1 percentage points. The current account balance, which moved into surplus in 2013, is expected to improve further, although at a more moderate pace than before. Continue reading “Portugal economic recovery strengthening”

EU maintained trade surplus with Brazil in 2013

eubrasilEU28 exports to Brazil in 2012 amounted to 39.7 billion euro and imports to 37.4 bn. The EU28 registered a continuous deficit in trade in goods with Brazil up to 2011, with a peak in 2007, turning to a surplus of 2.3 bn in 2012. The first nine months of 2013 confirm the most recent trend, with EU28 exports to Brazil continuing to increase, from 29.6 bn euro in the first nine months of 2012 to 30.4 bn in the same period of 2013, while imports continued to fall, from 28.8 bn to 24.9 bn over the same period. As a result, the EU28 surplus in trade of goods with Brazil of 0.8bn in the first nine months of 2012 increased significantly to 5.5 bn in the same period of 2013. Continue reading “EU maintained trade surplus with Brazil in 2013”

Steinweg opens new offices in SE Europe

logo C.Steinweg GroupThe Steinweg Group has opened  new offices in the port of Bar in Montenegro as well as in the city of Beograd in Serbia in order to strengthen the presence of the company in the region. The offices will be active in warehousing and logistics of metals and will serve the hinterland in Serbia, Montenegro, Bosnia, Kosovo, Albania and neighbouring countries, Steinweg announced.

New Dimensions of U.S. Foreign Policy Toward Russia

By George Friedman

georgefriedmanThe struggle for some of the most strategic territory in the world took an interesting twist this week. Last week we discussed what appeared to be a significant shift in German national strategy in which Berlin seemed to declare a new doctrine of increased assertiveness in the world — a shift that followed intense German interest in Ukraine. This week, U.S. Assistant Secretary of State Victoria Nuland, in a now-famous cellphone conversation, declared her strong contempt for the European Union and its weakness and counseled the U.S. ambassador to Ukraine to proceed quickly and without the Europeans to piece together a specific opposition coalition before the Russians saw what was happening and took action. Continue reading “New Dimensions of U.S. Foreign Policy Toward Russia”

OECD admits to forecasting errors during 2008-09 crisis

logooecd_enExtreme volatility during the global financial crisis complicated economic forecasting, leading to large errors that underline the need for better modelling methods and new approaches for making and presenting projections, according to an OECD report. OECD forecasts during and after the financial crisis: a post-mortem says that the Organisation’s economic projections under-predicted the depth of the collapse in activity in 2008-09 and over-estimated the pace of recovery in recent years. The degree of forecasting errors seen over the 2007-12 period is similar in size to that seen around the first oil shock in the 1970s. Continue reading “OECD admits to forecasting errors during 2008-09 crisis”

A More Assertive German Foreign Policy

By George Friedman and Marc Lanthemann

Angela MerkelThe Ukrainian crisis is important in itself, but the behavior it has elicited from Germany is perhaps more important. Berlin directly challenged Ukraine’s elected president for refusing to tighten relations with the European Union and for mistreating Ukrainians who protested his decision. In challenging President Viktor Yanukovich, Berlin also challenged Russia, a reflection of Germany’s recent brazen foreign policy. Since the end of World War II, Germany has pursued a relatively tame foreign policy. But over the past week, Berlin appeared to have acknowledged the need for a fairly dramatic change. Continue reading “A More Assertive German Foreign Policy”

Perspectives on the Ukrainian Protests

By George Friedman

georgefriedmanA few months ago, Ukrainian President Viktor Yanukovich was expected to sign some agreements that could eventually integrate Ukraine with the European Union economically. Ultimately, Yanukovich refused to sign the agreements, a decision thousands of his countrymen immediately protested. The demonstrations later evolved, as they often do. Protesters started calling for political change, and when Yanukovich resisted their calls, they demanded new elections. Continue reading “Perspectives on the Ukrainian Protests”

World Bank warns of emerging markets risks

worldbank-logo-enThe world economy is projected to strengthen this year, with growth picking up in developing countries and high-income economies appearing to be finally turning the corner five years after the global financial crisis, says the World Bank’s newly-released Global Economic Prospects (GEP) report. The firming of growth in developing countries is being bolstered by an acceleration in high-income countries and continued strong growth in China. However, growth prospects remain vulnerable to headwinds from rising global interest rates and potential volatility in capital flows, as the United States Federal Reserve Bank begins withdrawing its massive monetary stimulus. Continue reading “World Bank warns of emerging markets risks”

Three reasons why deflation won’t take hold in the Eurozone

europebynight3Inflation used to be the main focus for European central bankers’ interest rate policy as prices rose forever upward. Now their main fear as we begin 2014 is the reverse scenario – the risk of deflation. It is potentially a huge problem, as falling prices mean that consumers do not buy goods because they expect them to become cheaper in the future, stalling economic growth and triggering a recession. However, there are three reasons why a Japanese-style era of falling prices that cost the country a ‘lost decade’ in the 1990s will not take hold in the Eurozone, says Robeco’s Chief Economist, Léon Cornelissen. Continue reading “Three reasons why deflation won’t take hold in the Eurozone”

Carlyle and Vitol invest in Varo Energy to Create a Major New Energy Midstream Group across North-West Europe

vitollogoGlobal alternative asset manager The Carlyle Group and the Vitol Group of Companies announced a transaction intended to establish Varo Energy B.V. as a major midstream energy business in north-west Europe. Under the terms of the proposed transaction, Vitol and Carlyle International Energy Partners (CIEP) will each own 50% of an enlarged Varo Energy Group. AtlasInvest will sell its shareholding in Varo Energy to CIEP while Vitol will reduce its current stake to enable each party to own 50%. Continue reading “Carlyle and Vitol invest in Varo Energy to Create a Major New Energy Midstream Group across North-West Europe”

Rediscovering the Americas: The World’s 15 Best Countries for Business in 2014

terminalThe US, Germany, Poland and Mexico are among next year’s Best Countries for Business. Rotterdam Week in cooperation with Atlantico Business Development (an international consultancy based in Rotterdam) has selected the best 15 markets of 2014/15 for your direct investment or for exporting your products. Continue reading “Rediscovering the Americas: The World’s 15 Best Countries for Business in 2014”

Ukraine: On the Edge of Empires

By George Friedman

georgefriedmanThe name “Ukraine” literally translates as “on the edge.” It is a country on the edge of other countries, sometimes part of one, sometimes part of another and more frequently divided. In the 17th and 18th centuries, it was divided between Russia, Poland and the Ottoman Empire. In the 19th century, it was divided between Russia and Austria-Hungary. And in the 20th century, save for a short period of independence after World War I, it became part of the Soviet Union. Ukraine has been on the edge of empires for centuries. Continue reading “Ukraine: On the Edge of Empires”

The Netherlands among top countries in OECD’s global education survey

logooecd_enSome Asian countries as well as Switzerland and the Netherlands outperform the rest of the world in the OECD’s latest PISA survey, which evaluates the knowledge and skills of the world’s 15-year-olds. The OECD’s PISA 2012 tested more than 510,000 students in 65 countries and economies on maths, reading and science. The main focus was on maths. Math proficiency is a strong predictor of positive outcomes for young adults. It influences their ability to participate in post-secondary education and their expected future earnings. Continue reading “The Netherlands among top countries in OECD’s global education survey”

Equities set to rise further in 2014

equitiesEquities are set to rise further in 2014 after the world returns to normality, with higher global growth and the end of easy money in the US. These are the key predictions of Robeco’s Chief Economist Léon Cornelissen in his outlook for markets next year. Stocks are Robeco’s preferred asset class for 2014, although returns may not be as strong as in 2013, when the MSCI World Index rose almost 16% in the first 10 months of the year in euros on the back of stimulus from quantitative easing (QE) programs. Continue reading “Equities set to rise further in 2014”

Will a cabinet reshuffle save the Polish government?

By Remi Adekoya

donald tuskPrime Minister Donald Tusk has seen his popularity tank in recent months. The party he leads, Civic Platform (PO), is hardly in better shape. The latest TNS Polska poll showed the ruling party trailing its biggest rival opposition Law and Justice by 9 percentage points. Recent weeks have seen financial scandals come to light involving PO politicians. These are not happy days for the PM and his party. And so Mr Tusk has decided his government needs a make-over replacing seven ministers including the man who has been in charge of Poland’s finances for the past 6 years, Jacek Rostowski. The environment ministry, sports and tourism ministry, higher education and science ministry, digitalization and administration ministry and education ministry also all have new bosses as of today. Continue reading “Will a cabinet reshuffle save the Polish government?”

Global economy still recovering at moderate pace but more risks ahead

logooecd_enThe global economy is expected to continue expanding at a moderate pace over the coming two years, but policymakers must ensure that instability in financial markets and underlying fragility in some major economies are not allowed to derail growth, according to the OECD’s latest Economic Outlook. Growth in the United States is projected at a 2.9% rate in 2014 and a 3.4% rate in 2015. In Japan, GDP is expected to drop to a 1.5% growth rate in 2014 and a 1% rate in 2015. The euro area is expected to witness a gradual recovery, with growth of 1% in 2014 and 1.6% in 2015. Continue reading “Global economy still recovering at moderate pace but more risks ahead”