#pakistan current account deficit

[biographyit]

Pakistan records 10-year-high current account surplus

A currency trader counts Pakistani Rupee notes as he prepares an exchange of US dollars in Islamabad, December 11, 2017. — Reuters Pakistan posts $729 million current account surplus. Surplus reflects strong remittances, reduced trade deficits. November marks the 4th consecutive month of surplus. KARACHI: Pakistan posted its highest current account surplus in nearly 10 years in November, buoyed…

[news365timesindia]

[ad_1] A third researcher said Pakistan also has to cut its external expenditures through import substitution. (Photo: X @dailystar)3 min read Last Updated : Oct 14 2024 | 12:39 PM IST Pakistan's central bank has said the country is scheduled to repay a total of $ 30.35 billion in maturing foreign debt and interest payment in this financial year even as the foreign debt repayments and interest payments are rising every passing year, a media repot said on Monday. The payments over the 12 months from August 2024 to July 2025 include those significant loans which bilateral creditors roll over every year, reported the Express Tribune quoting a JS Global report, which, in turn, cited data from the State Bank of Pakistan (SBP). Click here to connect with us on WhatsApp  The report showed that Pakistan is to repay maturing foreign debt worth $ 26.48 billion and pay another $ 3.86 billion on account of interest expense in the period. Pakistan's repayments and interest payments are fully secured under the latest $ 7 billion IMF Extended Fund Facility (EFF) through the loan period of 37 months. In terms of debt-to-GDP ratio, however, the foreign debt has dropped to 20.2 per cent in August 2024 from 27.6 per cent in the same month of the last year, as the nation's economy expanded in FY24 compared to contraction in FY23. The data, however, pointed out the foreign debt repayments and interest payments are rising every passing year, emphasising upon the government economic managers, planners and parliamentarians to find ways to increase foreign income and cut external expenditures. The latest data suggests the sum of $ 30 billion is notably high compared to $ 21.2 billion (including rollovers) the country paid over the past 12 months (August 2023 to July 2024), according to the research house, JS Global. The jump in sum of repayments and interest payments for the ongoing 12 months was recorded after Saudi Arabia, UAE and IMF provided fresh loans worth around $ 4 billion in late June and July 2023 and IMF lent another $ 2 billion between August 2023 and April 2024, mounting the repayment pressure (including significant rollover) in the years to come. Citing the latest IMF documents, Topline Research, however, reported the country's gross external financing requirement has dropped to a 9-year low of $ 18.8 billion (excluding expected rollovers and contained current account deficit) for the ongoing fiscal year (July 2024 to June 2025). However, Pakistan is also estimated to add up fresh foreign loans to the tune of $ 3 billion to $ 4 billion in the ongoing fiscal year (FY25), another researcher said. A third researcher said Pakistan also has to cut its external expenditures through import substitution. Such remedies would help improve the nation's capacity to make external payments and boost foreign exchange reserves, according to The Express Tribune report. (Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)First Published: Oct 14 2024 | 12:39 PM IST [ad_2] Source link

[news365times]

[ad_1] A third researcher said Pakistan also has to cut its external expenditures through import substitution. (Photo: X @dailystar)3 min read Last Updated : Oct 14 2024 | 12:39 PM IST Pakistan's central bank has said the country is scheduled to repay a total of $ 30.35 billion in maturing foreign debt and interest payment in this financial year even as the foreign debt repayments and interest payments are rising every passing year, a media repot said on Monday. The payments over the 12 months from August 2024 to July 2025 include those significant loans which bilateral creditors roll over every year, reported the Express Tribune quoting a JS Global report, which, in turn, cited data from the State Bank of Pakistan (SBP). Click here to connect with us on WhatsApp  The report showed that Pakistan is to repay maturing foreign debt worth $ 26.48 billion and pay another $ 3.86 billion on account of interest expense in the period. Pakistan's repayments and interest payments are fully secured under the latest $ 7 billion IMF Extended Fund Facility (EFF) through the loan period of 37 months. In terms of debt-to-GDP ratio, however, the foreign debt has dropped to 20.2 per cent in August 2024 from 27.6 per cent in the same month of the last year, as the nation's economy expanded in FY24 compared to contraction in FY23. The data, however, pointed out the foreign debt repayments and interest payments are rising every passing year, emphasising upon the government economic managers, planners and parliamentarians to find ways to increase foreign income and cut external expenditures. The latest data suggests the sum of $ 30 billion is notably high compared to $ 21.2 billion (including rollovers) the country paid over the past 12 months (August 2023 to July 2024), according to the research house, JS Global. The jump in sum of repayments and interest payments for the ongoing 12 months was recorded after Saudi Arabia, UAE and IMF provided fresh loans worth around $ 4 billion in late June and July 2023 and IMF lent another $ 2 billion between August 2023 and April 2024, mounting the repayment pressure (including significant rollover) in the years to come. Citing the latest IMF documents, Topline Research, however, reported the country's gross external financing requirement has dropped to a 9-year low of $ 18.8 billion (excluding expected rollovers and contained current account deficit) for the ongoing fiscal year (July 2024 to June 2025). However, Pakistan is also estimated to add up fresh foreign loans to the tune of $ 3 billion to $ 4 billion in the ongoing fiscal year (FY25), another researcher said. A third researcher said Pakistan also has to cut its external expenditures through import substitution. Such remedies would help improve the nation's capacity to make external payments and boost foreign exchange reserves, according to The Express Tribune report. (Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)First Published: Oct 14 2024 | 12:39 PM IST [ad_2] Source link

[mcqpin]

Syllabus of Economics Business Economics-309 for 12th class

There will be one Question Paper which will have 50 questions out of which 40 questions need to be attempted from Economics/Business Economics 309. You can prepare complete syllabus for 12th exam and CUET competitive exam on mcqpin. Unit I: Introduction to Microeconomics - What is microeconomics? - Central problems Unit II: Consumer Behaviour and Demand - Consumer’s Equilibrium: meaning and attainment of equilibrium through Utility Approach: One and two commodity cases. - Demand: market demand, determinants of demand, demand schedule, demand curve, movement along and shifts in the demand curve, price elasticity of demand, measurement of price elasticity of demand – percentage, total expenditure, and geometric methods

Introductory Macroeconomics

Unit III: National Income and Related Aggregates — Basic Concepts and Measurement - Macroeconomics: meaning. - Circular flow of income, concepts of GDP, GNP, NDP, NNP (at market price and factor cost). - Measurement of National Income –Value Added method, Income method, and Expenditure method. Unit IV: Determination of Income and Employment - Aggregate demand, aggregate supply, and their components - Propensity to consume and propensity to save (average and marginal) - Meaning of involuntary unemployment and full employment - Determination of income and employment: two-sector model - Concept of investment multiplier and its working - Problems of excess and deficient demand - Measures to correct excess and deficient demand – availability of credit, change in government spending Unit V: Money and Banking - Money: meaning, evolution, and functions - Central bank: meaning and functions - Commercial banks: meaning and functions Unit VI: Government Budget and the Economy - Government budget – meaning and its components - Objectives of government budget - Classification of receipts – revenue and capital; classification of expenditure – revenue and capital, plan and non-plan, and developmental and non-developmental - Balanced budget, surplus budget, and deficit budget: meaning and implications - Revenue deficit, fiscal deficit, and primary deficit: meaning and implications; measures to contain different deficits. Unit VII: Balance of Payments - Foreign exchange rate meaning (fixed and flexible), merits and demerits; determination through demand and supply - Balance of payments accounts ¡V meaning and components - A brief analysis of recent exchange rate issues INDIAN ECONOMIC DEVELOPMENT Unit VIII: Development Experience (1947-90) and Economic Reforms since 1991 - A brief introduction of the state of the Indian economy on the eve of independence. Indian economic system and common goals of Five year Plans. - Main features, problems and policies of agriculture (institutional aspects and new agricultural strategy), industry (IPR 1956; SSI role & importance) and foreign trade. Unit IX: Current challenges facing the Indian Economy - Poverty absolute and relative; Main programmes for poverty alleviation: A critical assessment; - Human Capital Formation ¡V How many people become resource; Role of human capital in economic development; - Rural development: Key issues ¡V credit and marketing ¡V role of cooperatives; agricultural diversification; - Employment: Growth and changes in work force participation rate in formal and informal sectors; problems and policies - Infrastructure: Meaning and Types: Cases Studies: Health: Problems and Policies ¡V A critical assessment; - Sustainable Economic Development: Meaning, Effects of Economic Development on Resources and Environment, including global warming Unit X: Development Experience of India - A comparison with neighbours - India and Pakistan - India and China - Issues: economic growth, population, sectoral development and other Human Development Indicators Also view Syllabus of Accountancy Book Keeping-301 for Class 12th Read the full article

[techi001]

ADB Expects Pakistan's Economy to Slow Down Even Further This Year

The Asian Development Bank (ADB) has massively cut down Pakistan’GDP estimate to 0.6 percent for the current fiscal year, while saying that economic growth is expected to slow significantly in the fiscal year 2023 (ends 30 June 2023) in the wake of last year’s devastating floods, ballooning inflation, a current account deficit, and an ongoing foreign exchange crisis. According to the Asian…

[worldspotlightnews]

Rupee depreciation, admin controls shrink CAD to almost two-year low in Feb

  A general view of a container terminal at a port. — Reuters/File Deficit shrinks 68% to $3.9bn in eight months of current fiscal year. Exports fell 24% year-on-year to $2.198 billion in February. During Jul-Feb FY2023, exports decreased 10% to $18.639 billion. KARACHI: Pakistan’s current account deficit dropped to an almost two-year low in February as the imports reduced because of…

[gamekai]

Pakistans Current Account Deficit Shrinks 90 Pct In January

Pakistan’s current account deficit shrank by 90 percent in January 2023 as compared to the same month last year as the government continued with its strategy to restrict imports to evade an external payments crisis, the State Bank of Pakistan (SBP) has said XINHUA/, (UrduPoint / Pakistan Point News – 22nd Feb, 2023 ):Pakistan’s current account deficit shrank by 90 percent in January 2023 as…

[tezlivenews]

पाकिस्तान की अर्थव्यवस्था को इमरान ने किया बर्बाद, चालू खाता घाटा बढ़कर 1.6 अरब डॉलर तक पहुंचा

पाकिस्तान की अर्थव्यवस्था को इमरान ने किया बर्बाद, चालू खाता घाटा बढ़कर 1.6 अरब डॉलर तक पहुंचा

हाइलाइट्स पाकिस्तान की अर्थव्यवस्था को तगड़ा झटका, स्टेट बैंक ने जारी किए आंकड़े पाकिस्तान का चालू खाता घाटा अक्टूबर में बढ़कर 1.6 अरब डॉलर हुआ इमरान खान ने देश का बेड़ा गर्क किया, लगातार ले रहे विदेशों से कर्ज इस्लामबादइमरान खान के प्रधानमंत्री बनने के बाद पाकिस्तान की अर्थव्यवस्था लगातार डूबती जा रही है। शुक्रवार को स्टेट बैंक ऑफ पाकिस्तान ने जो आंकड़े जारी किए हैं, उससे पूरे देश की चिंता बढ़…

[indizombie]

Pakistan secured a $6 billion loan from the International Monetary Fund (IMF) designed to help the South Asian nation avert an economic crisis. The lender’s executive board will meet to approve Pakistan’s request for the 39-month loan, “subject to the timely implementation of prior actions and confirmation of international partners’ financial commitments," IMF’s mission chief Ernesto Ramirez Rigo said. The loan would represent the 13th bailout since the late 1980s from the IMF to Pakistan, which is facing a balance-of-payments crisis triggered by high fiscal and current-account deficits and dwindling foreign exchange reserves. The pact was reached after Prime Minister Imran Khan overhauled his economic team, including the installation of Reza Baqir, who previously served in senior positions at the IMF, as the central bank governor. The crisis prompted rating companies to downgrade Pakistan’s credit score, triggering an 18% slide in the nation’s currency and pushing the benchmark KSE-100 index of stocks to near the lowest level in almost three years.

'Pakistan, IMF agree on $6 billion bailout to ease crisis', Livemint

[goodluckpakistan]

Asim Saleem Bajwa, CPEC Authority Chairman Lt-General (retd) tweeted that clusters of tech institutes would be established around the Special Economic Zones (SEZs) being constructed under the China Pakistan Economic Corridor (CPEC).

The institutes will be preparing youth for the jobs in CPEC projects, this is our top priority, He said.

He added, “Gwadar Technical Institute to cater for new industry in a free zone is coming up fast”.

[inventivaindia]

Pakistan's government panics as UAE demands its USD 1 billion back from the country

Pakistan’s government panics as UAE demands its USD 1 billion back from the country

In a recent event that took place between Pakistan and United Arab Emirates left the former in a state of panic, creating another incident of embarrassment of Pakistan in the world. The United Arab Emirates has demanded its USD 1 billion back from Pakistan, with a deadline of March 12, 2021 which, by the time you read this article would be gone and unsurprisingly, the Imran Khan-led ruling…

[tazatta18]

Is USD/PKR Going to Touch 185 or Will Go Back to 152 Rupees in Future? https://youtu.be/ziji_uf7T2E Traders and industrialists have expressed concern over the devaluation of the Pakistan rupee against the US dollar, saying that the local currency's fall has far-reaching implications including increasing the cost of production. Lahore Chamber of Commerce and Industry (LCCI) President Mian Tariq Misbah, while talking to a private TV channel, said exporters were happy with the appreciation of the dollar, but the local industry is dependent on imported raw material, urging the government to take notice. “The survival of our local industry would become very difficult if the trend persists,” he said. LCCI Vice President Tahir Javed Chaudhry, said that the continuous rise in the value of the dollar is also increasing the debt burden on the government. Consequently, the citizens would suffer due to higher inflation. The currency has lost over 5% since July 2021 alone, and has been on a downward trend for over four months as a heavier import bill and widening current account deficit take their toll. 'Demand-side pressure' drives Pakistani rupee to 12-month low KASB Securities Managing Director AH Soomro said that if the deficit widens further, PKR could fall to 170 against USD, adding that the economy 'overheats' when the discount rate is at 7%. The country’s trade deficit also ballooned by 133% to $ 4.055 billion in August 2021 from $ 1.740 billion in August 2020. Exports posted a month-on-month negative growth of over 3.5% to $ 2.257 billion in August 2021 as compared to $2.340 billion in July 2021. #currency #cryptocurrency #pakistanirupees #pakistan #ispr #finance #financialcrisis #moneylaundering #crisis #imf #worldbank #asaindevelopmentbank #uno #turkey #china #russia #afganistan #usa #america #dollar #dollars #dollarrate #dollarrateinpakistan #statebankofpakistan #bankcorrupt #savepakistan #needhelp #economy #sbp #pakistaneconomy @isprofficial1 @imrankhan.pti @smqureshi.pti @govtofpakistan @ptiofficial @waqarzaka @un_ocha @unitednations @rterdogan @the_imf @adb_hq @worldbank @haqeeqat.tv @haqeeqattv2.0 https://www.instagram.com/p/CTdAkkpMmpZ/?utm_medium=tumblr

[rulystuff]

https://servicemeltdown.com/is-the-united-states-at-end-of-empire/

New Post has been published on https://servicemeltdown.com/is-the-united-states-at-end-of-empire/

IS THE UNITED STATES AT END OF EMPIRE?

America’s economic primacy is pretty much behind us. And, I don’t believe there is any chance of reversing a trend that began thirty plus years ago. The best-case scenario for the nation is to slow the rate of economic decline – never mind social and cultural decline, which are probably lodged in irreversible decay.  As Robert Kaplan says in his book, The Revenge of Geography, we might prolong our position of strength by preparing the world for our own obsolescence and thus ensuring a graceful exit.  But even this outcome will require the strength of will that has yet to be demonstrated by leaders in business, education, and government.

Economic primacy might be measured along many fronts – income per capita, rate of growth, productivity, foreign exchange reserves, among others – but if one looks at Gross Domestic Product (GDP), perhaps the coarsest measure of a nation’s economic well-being, then the United States has lost its economic primacy to China when compared on a purchasing power parity (PPP) basis.

The PPP approach levels the GDP calculation to each country’s relative price of goods. So, if a television set costs $500 in the United States while the same television costs $250 in China then, theoretically at least, we’re under counting China’s GDP by $250. Using the PPP rationale, China’s GDP was approximately $23.5 trillion in 2019 compared to that of the United States which came in at $21.4 trillion.

Some politicians, economists, lobbyists, and others, like to use a different measure of GDP to suit their own purposes. The nominal GDP, which looks at the total of goods and services produced at current exchange rates yields a substantially different calculation. The nominal GDP of the United States in 2019 came in at $21.4 trillion, a number which is identical to the nation’s GDP on a PPP basis. The reason for this is that the nominal GDP calculation is based on the dollar and so there is no currency conversion rate difference. By comparison, China’s nominal GDP came in at $14.3 trillion. If we only look at nominal GDP, it is clear we are being lulled into a false sense of economic security.

CHINA HAS UNRIVALLED DIPLOMATIC PATIENCE

Diplomatically, China also has an edge on the United States. In the 1980’s, the then leader of the People’s Republic of China, Deng Xiaoping, enunciated his famous maxim of tao guang yang hui. Interpreted variously, the maxim is meant as a foreign policy directive that regardless how muscular the nation might become economically, geopolitically, and militarily it is always best to keep a “low profile diplomatically.” No more beguiling example of Deng Xiaoping’s maxim is in evidence than in China’s Belt and Road Initiative. Simply put, China plans to build one “road” from China to Europe and thus control all manner of transcontinental commerce. Already, China controls or has a presence in ports that handle about two-thirds of the world’s container traffic. In Greece, the port of Piraeus, a storied port dating to the Fifth Century B.C., is majority owned by the China Ocean Shipping Company (COSCO) which makes Greece a strategic entry point for China into the heart of Europe.

In Central Asia, China’s power projection is as undeniable as it is ominous. Through the auspices of the euphemistically named Shanghai Cooperation Organization (SCO), China has, in effect, expanded its borders westward by 1,500 miles to the Caspian Sea. Strategically, the mostly land-based route from Khorgos, Kazakhstan on China’s western border to Piraeus has now achieved super-highway potential from China to Europe.

China established the SCO with original signatories Russia, Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan for the expressed purpose of promoting border security along its Xinjiang autonomous-region home to millions of mostly Muslim ethnic Uyghurs. Emblematic of China’s clout in the region, moreover, is that since the formation of the SCO both India and Pakistan have been granted membership in the organization. For the United States, it isn’t clear how much leeway it will now have to operate in Central Asia given the leverage that China has over SCO countries economically, diplomatically, and militarily.

China has also learned to game international organizations. The Paris Climate Accord, biased to begin with in favor of China, looks the other way when the nation burns far more coal than it officially admits. So, while emissions in the United States trend lower, potentially hobbling our fossil fuel energy sector, China’s continue to increase. China’ s shell game also involves the building of coal plants outside its borders to further fuel its economy without having to account for the consequent emissions domestically. The World Trade Organization (WTO) is also in China’s pocket as it refuses to rein in China’s channeling of state subsidies to its manufacturing companies so as to better compete on the world’s stage. The most egregious example, of course, of how China has played international and presumably apolitical agencies lies with the country’s spread of the devastating and deadly Coronavirus and how the World Health Organization’s (WHO) was complicit in the coverup of China’s misdeeds. In December, 2019, when Taiwan warned about the infectiousness of the virus, the WHO refused to share Taiwan’s warnings with the rest of the world. Clearly, the WHO was doing China’s bidding. To this day, Taiwan, at China’s behest, is boycotted from participating as a full-fledged member of the WHO.

IF WE’RE NOT MAKING STUFF WHAT ARE WE TO DO?

Let’s face it, manufacturing was lost to our shores for all intents and purposes several years ago. In 2015, China displaced the United States as the top manufacturing nation in the world. In 2019, China’s value-added output – in essence, the difference between price and the cost to produce – in manufacturing amounted to $3.9 trillion compared to $2.4 trillion for the United States. That gap will doubtless continue to grow.

There are now roughly 15 million workers in the United States engaged in manufacturing down from approximately 18 million in the 1980’s – President Trump, to his credit, was determined to revitalize manufacturing, steel, and coal but despite gains in these areas total employment numbers will continue to slip on a trend-line basis.  When one considers that China has approximately 112 million manufacturing workers, the competitive disadvantage for the United States becomes palpably clear.

In 2019 our nation’s goods deficit with China was approximately $345 billion. That gap is not likely to be made up in any of our lifetimes. So, that leaves Services as the new game in town. In 2019, Services accounted for roughly 69% of our nation’s GDP. And, as a nation, we better excel in that new cycle reality. It is true, the United States ran an annual balance of payments surplus in services with China of about $36 billion in 2019 – with U.S. exports amounting to about $56 billion and imports from China totaling $20 billion. But don’t let that fool you as a $20 billion gap will be easy for China to make up especially when one considers that China’s Services sector is growing at an average of 2% per year. And, unless we accelerate the rate of growth of exports – the rate of growth is about even for both imports and exports – we might soon be facing a deficit in this sector of the economy so crucial for the good health of the nation in the twenty-first century.

THE NATION FACES SOME VERY STIFF HEADWINDS

The United States economy has structural defects which will not go away simply by holding rallies and mouthing rhetorical flourishes in the halls of Congress. Decline might be inexorable but we should not stand by as mere spectators. The will and purpose to restore our economic vitality must be marshaled by every American. It must begin, first and foremost, by demanding of our leaders, our institutions, and ourselves to be unafraid to serve in keeping with American priorities. It is the remotest possibility that we can salvage the service economy and consequently our nation unless our standard of performance is nothing less than service excellence in everything we do.

We don’t have a lot going for ourselves: Labor productivity growth is stalled at near zero levels; the rate of household savings is paltry; regulation and taxation still suffocates businesses and individuals despite President Trump’s initiatives; unemployment – not the nominal rate but the U6 rate which measures the unemployed, those that are not looking for work, and those who have had to settle for part-time work –  is mired at levels of 7% (during the Obama years the U6 rate never got below 9.2%); and he national debt is now in excess of 120% of GDP. Entitlement spending while currently at a level of approximately 70% of the federal budget is on the threshold of becoming a perfect storm of out-of- control spending. The progressive policies of the Biden Administration will see to that as it attempts to solve every problem by printing greenbacks. The growing number of baby boomers reaching retirement age and the population’s longer life expectancy will further exacerbate the nation’s economic health.  

Perhaps the most troubling portent for the nation’s future is its inability to clamber out of a deep and black hole in education. Among the 37 industrialized nations which comprise the Organization of Economic Cooperation and Development (OECD), for example, the United States ranks 31st in mathematics and roughly in the middle on science. Clearly, all of the monetary and fiscal policies in the world will hardly fix this crippling deficiency which has more to do with a cultural indifference to serious and rigorous education.

Prior to Mr. Trump’s coming to office, the federal government was hell-bent on redistributing wealth rather than getting out of the way so that risk capitalists could create wealth. Unfortunately, President Trump’s reforms designed to bring back a full-throated and free market approach to the nation’s financial issues died the moment President Biden came into office.

Meanwhile, in the corporate world, business leaders are fixated on how quarterly earnings affect their pay packages, and when push comes to shove, cutting corners and worse. How else can one explain the utter disregard American companies operating in China have for the human rights abuses perpetrated by the Chinese Communist Party (CCP) on its people. Abuses such as forced labor (unions are illegal in China), the internment of over a million Uyghurs and other ethnic minorities, bans on religious freedom and free expression, arbitrary arrests, and the repression of Hong Kong citizens seem not to bother the likes of executives at Caterpillar, General Motors, Ford, AMD, Micron Technologies, Intel, Texas Instruments, Nike, and many others which are doing a land-office business in China. Apple, most notably, has raised to an art form tax, regulatory, and labor dodges which allow it to stash hundreds of billions of dollars overseas while paying little or no income taxes in the United States. The company, apparently, is nonplussed by the fact that its armies of workers in China are employed for wages and benefits that would be in contravention of United States laws. How the CEO’s of these companies can live with themselves knowing full well that they are profiting from someone else’s misery is a testament to their greed and lust for power.

WHERE DOES THE CUSTOMER FIT IN?

From the way we treat our veterans, clients, patients, students, donors, and citizens – customers, all, to my way of thinking we have a lot of work to do before we can claim to excel in service. A survey by consulting giant Accenture in 2007 showed that 41% of respondents described service quality as fair, poor, or terrible – more recent surveys suggest service is worsening. Perform any human endeavor at that level of proficiency and you are an abject failure. In the services sector, however, that is par for the course. In the Far East, cultural determinants do not confuse service with servitude. As a rule, suppliers will go the extra mile to please a consumer. In the West, and particularly in the United States, the most that a service worker can muster when asked to perform a personalized service is to utter something like, “no problem.” That kind of indifferent attitude is ingrained and certain to keep our level of service quality from climbing out of the aforementioned levels of mediocrity.

In the meantime, off-shore locations feast on our indifference to service and do whatever it takes to secure and maintain a customer relationship. The oft-cited explanation for the comparative advantage of off-shore locations, namely, their low cost, is a facile response to a more complicated dynamic. It is true that off-shore locations enjoy all-in cost advantages vis-a-vis the United States. It is also true, that President Trump worked hard to enhance our competitiveness on the world stage by reducing the oppressive web of regulation; reducing our world-leading corporate tax rates; negotiating better trade deals; exiting globalist compacts financed on the backs of American taxpayers; offering a tax holiday for repatriated corporate profits, among other initiatives. Those initiatives, however, have either been rolled back or will soon be under President Biden’s Administration.

My experience is that, particularly in technical disciplines, services delivered by off-shore locations are superior to ours. An apprenticeship initiative, if it were aggressively expanded to include science, technology, engineering, and mathematics (STEM) occupations, might make us more competitive in this area. In the rarefied world of supercomputers so critical to pushing the frontiers of science and technology, for example, the United States is out-produced by China on the order of two-to-one. So, until and unless we grow a much larger crop of more competent technical workers we will continue to be outperformed by nations more determined, better educated, more dedicated, and hungrier than we are.

CAN THE UNITED STATES GUARANTEE THE PEACE?

If the nation has ceded its economic primacy, its military primacy is being severely tested. United States’ land-based forces are heavily committed to counterinsurgency operations to fend off non-state actors while conventional warfare strategic planning appears to be dead. In Europe, a likely conventional hotspot, NATO and U.S. forces are outgunned and outmanned by a factor of at least ten to one by Russian forces. In the far East, China’s land-based forces outnumber the United States by a factor of at least two to one.

Our ocean defenses are in no better shape. The nation’s principal bulwark protecting our shores is in steep decline. The United States Navy is but a ghost of its former self. The nation now has fewer vessels than it had before World War I. Most notably, our aircraft carrier fleet which must number sixteen in order to patrol three separate ocean theaters now numbers ten or barely enough to protect two theaters. In the Mediterranean, the U.S. Sixth Fleet is a non-entity the result of which is to have created a vacuum that is now filled by the Russians, Syrians, and Iranians. In the South China Sea, where American Navy vessels seem unable to sail without colliding into tankers and containerships, the United States is being challenged by a territorially aggressive and technologically advanced Chinese Navy. Already, an armada of sophisticated dredging vessels is reclaiming land from the sea for the sole purpose of building military airfields and naval port facilities. More worrisome, Chinese fighter jets and bombers now violate Taiwan’s air space with impunity and regularity.

Former U.S. Undersecretary of the Navy, Seth Cropsey, in his chilling and sobering account, Mayday the Decline of American Naval Supremacy, reminds us that China was the naval hegemon in the fifteenth century. Under the leadership of Admiral Sheng He, Chinese sailors coursed the oceans from their territorial waters to the Strait of Hormuz. Chinese vessels of the time were of a length and tonnage that were not to be seen in the West until centuries later. China’s naval supremacy only came to an end when civil servants forced severe budget cutbacks on the kingdom. Does our own defense budget sequestration of 2013 under President Obama, with its mandate to, in effect, disarm the military, ring a bell? The results of each nation’s budget missteps are eerily similar. China, for its part, will probably not repeat its mistake. In all likelihood, it will take the United States a generation, assuming proper funding and political will, to restore the U.S. Navy so that we can confidently state that the nation can project power and protect seaborne commerce beyond the horizon.

Just as troubling as the rickety state of the nation’s military naval forces is the state of the United States Merchant Marine. The Merchant Marine fleet hauls cargo during peacetime and is attached to the Defense Department during wartime to transport troops and supplies into war zones. The United States should hope it does not get into a major conflagration oceans away as it has experienced a dramatic attrition in its Merchant Marine fleet and manpower inventory. In 1960, the United States had nearly 3,000 vessels in the Merchant Marine fleet. Today, the nation has fewer than 175 vessels or less than one-half of 1% of the total vessel count worldwide. Worse, United States-flagged vessels carry a mere pittance of the total volume of goods and materials that transit through the nation’s ports. The consequence of what is obviously a weak flank in the nation’s defense posture is that in the event of a major outbreak of hostilities the United States would be reliant on foreign-flagged vessels to carry troops, armaments, and supplies with all of the attendant security risks.

One can argue that China’s bellicosity toward the United States is as asymmetrical as it is frontal and direct: China’s theft of roughly $225 billion, at the low end and as much as $600 billion at the high end, annually in counterfeit goods, pirated software, and theft of trade secrets from the United States; its monopoly of rare earth metals critical not just for consumer products but for Defense Department applications; its financing of over fifty Confucius Institutes on college campuses and schools designed to spread CCP propaganda; and its unleashing of the Wuhan virus which has cost the lives of more than six-hundred thousand innocent Americans is proof positive that China’s strategy is to envelop the United States on all fronts. And, the United States’ military is playing into China’s hands by its determination to “feminize” its armed forces. Progressive ideologues both in the Biden Administration and the Pentagon are using the military as a social experiment petri dish which is undermining the combat readiness of those in a position to protect our shores in the event of war. All you need to know in this regard comes from the Current Commander in Chief, Joseph Biden: “We’re making good progress designing body armor that fits women properly; tailoring combat uniforms for women; creating maternity flight suits; updating – updating requirements for their hairstyles…”

AMERICA AT A CROSSROADS

In sum, if as the great military historian B.H. Liddell Hart suggests, a nation’s Grand Strategy is a composite of its political, military, economic and diplomatic tools in its “arsenal” which can be brought to bear to advance a state’s national interest then the United States appears to be convulsing in its gradual decay. As I have argued in my essay, The United Kingdom Is Resurgent, the former world economic power, lost its supremacy because it failed to adapt to the winds of change which buffeted its shores long after the economy reached its apex in the early twentieth century.

It is also provocative to think that there might be a “natural” life cycle to nations as there is to human beings that is irreversible. Regardless of one’s view in embracing one or another theory that might explain the demise of nations, there is no reason to remain indolent in resisting such decline even if there is only the remotest possibility of such an outcome. Keep in mind that the demise of Rome was hardly cataclysmic but the result of a long succession of imprudent decisions made by the Empire’s leaders.

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[worldspotlightnews]

Pakistan’s current account deficit hits two-year low | The Express Tribune

KARACHI: Pakistan’s current account deficit (CAD) hit a two-year low of $74 million in a month, narrowly failing to turn around the country’s deficit into surplus in February. The government achieved the significantly low deficit through limiting imports to manage with low foreign exchange reserves and high risk of default on foreign debt repayments. The low imports, however, slowed down…

[hamariworld]

Pakistan’s current account in deficit for the second month

Pakistan’s current account in deficit for the second month

Stood at $50 million in February Pakistan’s external account posted a deficit for the second month in February as its current account deficit (CAD) stood at $50 million. It was $210 million in January. However, the current account during the eight months of FY2020-21 is still in a surplus of $881 million. It was in deficit of $2.7 billion during the same period last year. “On a month-on-month…

[alexsmitposts]

Will China Trigger Next Financial Tsunami? With the US decision to impose added tariffs on more than $300 billion of China trade, and the US Treasury declaring China a “currency manipulator”, global financial markets have reacted with sharp selling. The question is whether this is the beginning of a genuine currency war that will trigger a new Financial Tsunami as bad if not worse than that of the Lehman Crisis in 2008. The timing also coincides with escalation of geopolitical clashes between Washington and Venezuela, between India and China and Pakistan over Kashmir, between Turkey with Syria and with Cyprus, as well as the escalating tensions between Hong Kong and Beijing. Are we on the verge of a so-called “perfect storm” that will transform the post-1945 global order? After the breakoff of talks between Washington and Beijing at end of July, US President Trump announced his decision to impose added tariff sanctions on another $300 billion of China products. At that point the Peoples’ Bank of China (PBOC) let the exchange rate of the yuan fall below a psychological resistance level of 7.0 to the US dollar. It had kept the currency above 7.0 for more than a decade to stabilize US trade flows. US stocks reacted with one-day falls of well over 3%, paper losses over $1 trillion and a sharp rise in gold, as investors began to prepare for what could become a dangerous currency war with the world’s second largest economy. In addition, reneging on previous pledges to import more US agriculture products, the Beijing government ordered state buyers to stop all US agriculture purchases at the same time. As well, evidence grows that Beijing is making business more difficult for certain foreign firms in China. Renminbi Currency Reserves Although the PBOC over the next two days moved to stop the fall of the Renminbi (RMB), easing fears of all-out currency wars, as of this writing the China currency is poised to fall significantly, putting major pressure on other Asian export countries such as Japan and South Korea and India. At the same time China’s special financial window to the Western markets, Hong Kong, stands on the brink of a possible martial law and military crackdown from the PLA troops of the mainland, to end weeks of huge popular protest against new laws that would weaken agreed provisions of Hong Kong autonomy. Martial law in one of Asia’s major financial centers would not be positive for China’s efforts to get the China currency accepted as a major reserve currency for trade, a cornerstone of the government’s long term strategy. It would also not help China attract hundreds of billions of foreign investment in its own bond and stock markets. What is not yet clear is whether this series of events portends the end of the globalization of the world economy on which China has built its impressive economic expansion on for the past three decades or so. One key issue is what impact the latest escalation of economic tensions between Washington and Beijing will have on the long-term strategy of making the China currency a major world reserve currency, a critical step for their future ability to fully integrate with global capital markets and expand their ambitious Belt Road Initiative. Here is where signs are that the latest moves to allow the Renminbi to break the critical 7.0 level may be more psychological warfare than actual full financial warfare. After years of trying, China finally won acceptance of the Renminbi as one of only five world currencies composing the IMF Special Drawing Rights (SDR) currency basket along with the US dollar, British Pound, Japan Yen, and Euro in beginning of 2016. The aim has been that the Renminbi could begin to partly replace the dollar in world trade. Were that to happen it would be a major gain for China as a global financial factor and a major reduction of the role of the US dollar and US influence. Since 1945 US global hegemony has rested on two pillars–the US military as dominant and the dollar as world reserve. Since the 1944 Bretton Woods agreement, the US dollar has been the dominant currency in world trade and also in world central bank reserves. With introduction of the Euro almost two decades ago, many predicted the dominance of the dollar would end and with it, an enormous advantage the US has to run US budget deficits financed by others including China whose trade surplus dollars inevitably go to buy US Treasury and related debt. Since the Greek crisis after 2010 exposed major flaws in the Euro architecture and the weakness of EU banks, the challenge from the Euro as alternative to the dollar has stagnated. Latest IMF data show the dollar still holds some 61% of the world central bank reserves and still dominates world trade currencies with 40% of all payments in dollars while 30% are in Euro including the large intra-EU trade. As of 2018 the China RMB accounted for less than 2% of all global payments and around 1% of world central bank reserve holdings. This will become of vital importance to China now as it sees 25 years of unprecedented trade and balance of current account surpluses turn to deficit beginning this year or next. China Surplus Falling Current account surplus has defined China’s economic rise and her status as major source of global credit as the Peoples Bank of China (PBOC) invested record export surpluses into foreign assets, mainly government bonds, and much of that US government bonds. Some economists warn that the PBOC could deploy its financial weapon against US pressure by dumping an estimated $1.3 trillion of US bonds, likely collapsing the US economy in the process. Such dramatic action is however unlikely as China would become a major loser in the process. Not only would the value of China US bonds collapse, also China’s ability to attract hundreds of billions of foreign investment in China bond markets would be at high risk. This year for the first time in 25 years China is likely to run a deficit in its current account. Current account, the sum of trade balances and capital flows, has been hugely positive for China since the mid-1990s as it became the cheap labor “workshop of the world.” China Needs Foreign Investors This year for the first time in nearly 25 years China is expected to have a deficit on its Current Account. This is no small matter. A new report by Wall Street bank, Morgan Stanley, estimates that to balance this growing deficit China will need to attract billions in foreign investment. The report states, “Due to the ongoing transition to a consumption-led economy and a decline in savings amid an aging population, China’s annual current-account deficit could reach as much as 1.6% of GDP—or $420 billion—by 2030.” If true, that is a huge shift in dependence for China. In terms of surplus in goods exports, China has already gone from a surplus of 10% of GDP in 2007 before the major financial crisis, to 2.9% in 2018. This year could be a small deficit. Today foreign investment in China bonds is small at about $35 billion. Morgan Stanley estimates the size of China’s bond market, the heart of the debt system, to be over $12 trillion, third behind Japan with $13 trillion and USA with $40 trillion, but larger than say UK or France. As China’s economy undergoes a major shift to current account deficit over the next few years, it must be able to attract new inflows of investment in its debt from outside. This is a huge problem potentially. This also explains a major reason behind China’s push to develop state-of-the-art advanced industry in its Made in China 2025 strategy that is the true target of Washington trade pressure. At this juncture it looks like a high-risk game of financial chicken between Beijing and Washington. It appears clear that Xi Jinping has decided to hunker down and hold out until the US elections next year in hopes Trump will lose to a pro-China Democrat. What is clear is that this is about far more than any imbalance in China’s trade with the USA.