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 … 

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.


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.


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.


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.


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.