Valentina Romei

Following on from 10 charts (part 1), which included the first five challenges facing the next Italian government, here are the next five as we head towards Italy’s general election.

1) Corruption

Corruption is a plight for the country that together with bureaucracy prevents an efficient allocation of resources and discourages investment. Transparency International’s Corruption Perceptions Index ranked Italy 72nd out of 182 countries evaluated in 2012, three positions lower than the previous year. The perception of corruption of Italians is particularly high for the political system, which is one of the main reasons for the country’s political instability and poor governability.

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Valentina Romei

Italian general elections on February 24 and 25 will determine the members of the Chamber of Deputies and of the Senate, the two houses of its parliament. This new parliament will face various structural factors behind the country’s weak performance.

Here is the first instalment of the country’s top challenges in 10 charts – another five are set to follow later in the week, so stay tuned.

1) Stagnant economy in the past decade

The Italian gross domestic product is lower than at the beginning of 2001 and the decline does not show signs of reversing. Even Spain and Greece with their deep economic contraction during the crisis are better off than at their levels at the start of the last decade thanks to their strong growth performance before 2008. Italy had sluggish growth even in the first half of the past decade and the additional output that has been created was totally wiped out with the crisis.

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Valentina Romei

The number of self-employed in the UK rose by 60 per cent between 2011 and 2012 and now accounts for about 14 per cent of all people in employment.

This is a striking contrast with the rest of the OECD countries where the proportion of self-employed is generally declining. In 2011, there were between 2 and 5 percentage points fewer self-employed in South Korea, Turkey, Portugal, Japan and Italy than six years before. Most of the other OECD countries reduced their proportion of self-employed even if more slowly. Read more

Valentina Romei

Berlusconi, the billionaire former Italian prime minister pledged to reimburse Italians €4bn for an unpopular property tax. This is probably the first time he has promised to give money back, but it is definitely not the first time he has pledged to cut taxes.

Berlusconi lavished promises of tax cuts periodically throughout the past decade, but he failed to translate them into reality, even when he was in power from 2001 to 2006 and again from 2008 to the end of 2011.

In fact, according to the OECD the average income tax rate increased in Italy across all types of households, whereas it was reduced in most other OECD countries. Read more

Valentina Romei

The UK census data revealed that about eight per cent of the resident population speaks a language other than English as their main language.

This is not a large proportion, at least compared with many advanced countries. Read more

Valentina Romei

House prices in Europe are falling according to Eurostat’s first house price index. House prices are widely monitored at a national level but there is shortage of comparable measures across countries. This new index partially covers this gap, but the picture it portrays is not encouraging.

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Valentina Romei

Indian car sales continue to slow down. This is being reported as a sign of a broader economic slowdown. But car sales is not the most representative measure of vehicle sales in India – most people drive two-wheeler vehicles.

Passenger car sales growth slowed to below 3 per cent in the first half of 2012, down from over 30 per cent at the end of 2010, but it now shows signs of recovery. The story that emerges when looking at two-wheeler vehicles is quite different, though. Read more

Valentina Romei

Chinese exports grew faster than expected in December, lifting hopes for a prompt recovery from the country’s slowdown. The December reading for exports is certainly good news, but there should be caution in looking at monthly export figures. Read more

Valentina Romei

Labour productivity continues to fall in the UK, today’s latest ONS release shows.

Output per hour dropped by 0.2% in Quarter 3, 2012, compared to the previous quarter. This means a fall of over 2% compared to the same period last year and over 3% compared to the pre-crisis period. This is a particularly striking drop considering than in the five years before the financial crisis labour productivity rose by over 12%.

The reasons for this remain rather a puzzle. And a look at other European countries confirms that the UK is unusual. But it’s not unique. Most core European countries had a drop in productivity levels compared to those in the US. But their performance varied considerably during the last few years of economic crisis, as this chart highlights … Read more

Valentina Romei

At the start of this year, Mario Monti, the Italian prime minister, unveiled a programme of liberalisation, which together with austerity measures were meant to put the country back on track for growth.

The package triggered protests from taxi drivers, pharmacists, petrol station operators and lawyers – all professions that were included in the liberalisation plan. The measures also targeted the gas and electricity market, the insurance sector and local public services. The aims of these plans were to reduce the costs of goods and services to consumers and to foster competition among providers, with cheaper products and services making the austerity measures easier to digest.

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Valentina Romei

Chinese exports grew less than expected in November, fueling fears of a further economic slowdown. But exports from western inland Chinese regions have never grown so fast as in 2012, beating export growth rates of the rich industrial coastal regions.

Chinese export growth declined to 2.9 per cent in November from 11.6 per cent in October. On a rolling 12-month sum exports grew at an annual rate of 7.9 per cent in November, a figure well below the more than 30 per cent growth of the late 2010 and early 2011 and marks a 28-month record low. But not all regions in China experienced the same slowdown.

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an investor looking at stock prices at a securities brokerage in ShanghaiChinese equities are in the doldrums. Both the Shenzhen composite and the Shanghai composite indices touched their lowest level in over three years this week, marking a loss for both indices of around 10 per cent since the start of the year.

But not all Chinese stocks are falling. Hong Kong’s Hang Seng China Enterprises Index, composed of mainland companies, is up by around 6 per cent. So stock selection matters. Chart of the week takes a look.

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Brazil is a commodity exporter – and even more so than official statistics suggest. The share of its exports taken by what are classified by the government as primary goods was just below 30 per cent for most of the past two decades, rising to nearly half of all exports in the last five years. But if we include items such as raw and refined sugar, unsweetened cocoa powder, crude soybean oil, cocoa butter and other products that have a level of processing but are closely derived from commodities dug up or harvested in the country, the proportion rises to different levels. Chart of the week takes a look.

The revised picture shows the shrinking role in trade played by Brazilian manufacturers and the vulnerability of Brazilian exports to the shifting tides of the global economy.

Using our broader classification, Brazil’s commodity-based exports rise to half of the total during the past two decades and to more than two thirds in the last year. The share of manufactured goods therefore falls from about half to less than a third – showing that growth in Brazilian exports has been driven entirely by commodity-based goods.

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Thailand’s economy grew at a 3 per cent year on year in the third quarter, a slight decrease from Q2 but in line with analysts’ expectations.

But as data released on Monday show, the pattern of the previous four quarters is now entrenched – Thai GDP is being dragged down by its poor export performance. Chart of the week takes a closer look.

As the chart below shows, Thailand’s economy would have grown at 4 per cent in the third quarter, a full percentage point higher, were it not for the negative net contribution of exports. Even so, things were better than they were during the previous three quarters, when the economy would have grown as much as 4 to 6 percentage points faster if it was not for the negative impact of exports.

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Valentina Romei

Today, World Diabetes Day, is a good time to look at what countries weigh. Not in economic heft or population numbers, but the actual physical weight of their population.

Specifically, we established countries’ share of the global population and their share of global weight (using data on their average body mass index (BMI) and their average height for the male population over 20 years old). Then we calculated the difference between these two measures.

The weightiest countries are the US, Mexico and Brazil: their share of the total global body mass is bigger than their proportion of the global population. All three countries have an average body mass index of above 25, which corresponds to being overweight. Read more

Partial results from Ukraine’s parliamentary election on Sunday suggest a narrow victory for the governing party of Viktor Yanukovich, president since 2010.

It is still too early to say whether Yanukovich’s Party of Regions will be able to build a working majority, and at what political cost. But the election looks unlikely to make it any easier for Yanukovich to tackle his country’s pressing economic problems.

In autumn 2010 the IMF forecast growth for this year of nearly 5 per cent. It cut that forecast to 3 per cent a few weeks ago. That’s a significant revision, bearing in mind that the Fund cut its forecast for Russia by 1 percentage point, while for the whole CIS region its forecast for this year has fallen by only half a percentage point over the past two years.

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In Europe and the US, they are often called “squeezed” or “worried”. In developing markets, they are “booming”, “growing” and, of course, “emerging”.

The middle classes are changing consumption habits around the world. Chart of the week takes a look at some key emerging markets and the level of middle class spending.

 

We have used data from the OECD and the Brookings Institution which define the middle class as those earning 10 to 100 dollars at purchasing power parity per day. On this basis, more than half of the globe’s middle class people are forecast to be in the Asia Pacific region in fewer then 10 years, compared to the current proportion of only one in four.

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Valentina Romei

The UK Department for Transport is under fire over the cancellation of a deal to award a rail franchise, because of “technical flaws” in the bidding process.

The incident brings the British railway system back into the headlines, where it has often been because of contested fare rises. Complaints about the railways may be something of a national sport, but according to a survey published last month by Eurobarometer, the European Commission body that analyses public opinion, people in the UK are more satisfied with their national and regional rail system than most of their European counterparts. Read more

Valentina Romei

The US has shown a turnround after data released by the Institute for Supply management showed an index rise in manufacturing after three months of consecutive contraction. However, there are doubts whether the positive trend will continue in the the near future for the US, whereas for India, Russia and Turkey, the expansion seems more robust.

In India, manufacturing output in September expanded at a faster rate than in August, with its order book rising and new export orders increasing for the first time since June. Rising demand has also helped Turkey, in addition to new business from abroad, after a fall in output in July and August. Read more

Valentina Romei

Ever feel you’ve read all there is to read about China’s growth as a world manufacturing power? Well, did you know that China now has almost complete control of the world’s umbrella market?

China exported over $2.4bn of umbrellas, walking-sticks and whips in 2010, over three quarters – and rising – of global export share.

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