Latest in Economics
Egypt Today
12 minutes ago
- Business
- Egypt Today
Investment outlook for 2025 weak amid policy uncertainty, but Egypt among key bright spots: UNCTAD
Director of the Investment Research Branch at UN Trade and Development (UNCTAD), Richard Bolwijn CAIRO - 19 June 2025: Director of the Investment Research Branch at UN Trade and Development (UNCTAD), Richard Bolwijn, warned that global foreign direct investment (FDI) flows are under growing pressure amid rising trade tensions, weak investor confidence, and ongoing policy uncertainty. He said that preliminary data for early 2025 suggests the investment climate remains fragile, with record-low project announcements in the first four months of the year. Speaking virtually at the Cairo launch of the World Investment Report 2025, Bolwijn noted that global FDI declined by 11% in 2024, marking the second consecutive year of contraction, with the drop driven largely by Europe, China (which recorded a 29% decline), and South America. However, he highlighted Africa as a bright spot, with FDI inflows rising by 75%, including a 40% increase in inflows even when excluding Egypt's megaprojects. 'Egypt stood out with several large-scale projects, making it a key driver of the continent's growth,' Bolwijn said. He explained that project finance, which is a key source of investment for infrastructure and development, has seen a multiyear decline globally, but Egypt was an exception. 'While international project finance has been on a downward trend, Egypt managed to attract significant volumes, particularly in energy and infrastructure,' he added. Bolwijn also pointed to manufacturing investment as another area of modest global recovery, noting a small uptick in industrial projects in response to supply chain shifts. However, he emphasized that most of this investment still goes to a few countries, primarily those that have proximity to major markets, stable policy environments, and access to trade agreements, areas where North African economies like Egypt have potential advantages. On the digital economy, Bolwijn said it remained the fastest-growing sector globally, driven by strong flows into data centers and fintech, although investment remains concentrated in a limited number of countries. Looking ahead to 2025, Bolwijn warned of persistent risks. 'Trade policy uncertainty, tariff escalations, and investor caution are delaying project implementation,' he said. He added that multinational corporations are 'in a wait-and-see mode,' affecting short-term investment prospects. He concluded by highlighting key areas for policy focus: strengthening regional trade and integration, attracting investment in sectors less exposed to trade disruptions, such as local manufacturing, scaling up infrastructure project finance, and enhancing investment promotion mechanisms, including digital platforms. 'Countries like Egypt that continue to push for reform, improve investment facilitation, and focus on key sectors are better positioned to navigate the current downturn,' Bolwijn said.
The Independent
32 minutes ago
- Business
- The Independent
Stocks dip as Bank of England leaves interest rates unchanged
London's FTSE 100 closed lower on Thursday amid ongoing Middle East concerns, after the Bank of England left interest rates unchanged at 4.25%. The FTSE 100 index closed down 51.67 points, 0.6%, at 8,791.80. The FTSE 250 ended 216.27 points lower, 1.0%, at 21,073.99, and the AIM All-Share fell 5.17 points, 0.7%, at 758.19. The London Stock Exchange celebrated the 30th anniversary of AIM on Thursday, calling it a 'cornerstone' of the UK's capital markets. Since its launch in 1995, AIM has become one of the world's most successful growth markets, helping more than 4,000 companies raise over £136 billion. The decision to hold rates by the Bank's Monetary Policy Committee was widely expected, although the vote split was slightly more dovish than forecast. The MPC voted 6-3 for the status quo, with Swati Dhingra, Bank deputy governor Dave Ramsden and Alan Taylor preferring a 25 basis point rate cut to 4.00%. The Bank said there remain 'two-sided' risks to inflation meaning 'a gradual and careful approach to the further withdrawal of monetary policy restraint remains appropriate'. The Bank noted that higher food prices could raise 'inflation expectations, impacting wage and price-setting behaviours'. Bank of England governor Andrew Bailey said interest rates remain on a 'gradual downward path'. Ebury analyst Matthew Ryan said: 'The BoE still appears to be in no hurry to speed up the pace of policy loosening. Importantly for markets, the phrase that cuts will be both 'gradual and careful' was retained in the statement – there was some speculation that this could be either tweaked or jettisoned.' ING noted past experience has shown that the vote split contains few useful signals. 'December's meeting saw a similar 6-3 vote, yet heralded little change in the bank's overall stance,' ING said. It added that rate hawks will have an eye on oil prices. A 'serious spike in oil prices is the most obvious hawkish risk for the UK rate outlook', ING said. Nonetheless, ING expects the Bank to cut interest rates in August. The oil price rose again amid concerns the situation in the Middle East could worsen. Brent oil traded higher at 78.59 US dollars a barrel late on Thursday from 75.06 dollars on Wednesday as the Israel-Iran conflict continued. The oil price rise boosted oil majors and FTSE 100 heavyweights BP and Shell, which rose 1.4% and 1.1% respectively, but weighed on British Airways owner IAG, down 3.2% and low-cost airline easyJet, down 3.0%, on concerns of rising fuel costs and travel disruption. Israel's defence minister Israel Katz said Iran's Supreme Leader Ayatollah Ali Khamenei cannot 'continue to exist', days after reports that Washington vetoed Israeli plans to assassinate him, AFP reported. 'Khamenei openly declares that he wants Israel destroyed – he personally gives the order to fire on hospitals,' Mr Katz told journalists. 'Such a man can no longer be allowed to exist.' US President Donald Trump wrote on Tuesday that the US knew Mr Khamenei's location but would not kill him 'for now'. Uncertainty surrounds Mr Trump's next move amid reports that the US is ready to intervene in the conflict. Bloomberg on Thursday reported senior US officials are preparing for the possibility of a strike on Iran in coming days. In European equities on Thursday, the Cac 40 in Paris closed down 1.1%, as did the Dax 40 in Frankfurt. Financial markets in the US were closed to mark Juneteenth National Independence Day. The pound was quoted down at 1.3429 dollars at the time of the London equities close on Thursday, compared with 1.3472 dollars on Wednesday. On the FTSE 100, fears the Middle East conflict will lead to higher inflation and slower economic growth weighed on mining stocks. Anglo American fell 3.3%, Antofagasta declined 3.4% and Rio Tinto dipped 2.5%. Whitbread fell 1.6% after reporting total group sales fell by 3.8% to £710.9 million in the 13 weeks that ended May 29, the first quarter of its financial year, from £739.2 million a year earlier, or by 1% on a like-for-like basis. Total UK sales were down 5.4% to £648.2 million from £685.2 million. Accommodation sales fell 1.8% to £485.0 million from £494.1 million, while food and beverage revenue sales dropped 15% to £163.2 million from £191.0 million. UK revenue per available room fell 2.4% to £62 in the quarter from £63.54 a year ago. On the FTSE 250, Hays plunged 10% after saying it expects annual profit to be below market consensus, as the staffing firm grapples with challenging market conditions. AJ Bell's Russ Mould said the share price slump implies the jobs market is going from bad to worse. 'Companies are clearly worried about the economic outlook and they're reluctant to take on full-time staff, potentially not replacing anyone lost to natural turnover. At the same time, individuals are worried that if they move job they'll be in the 'last in, first out' firing line if companies look for new cost savings,' he added. Hays said permanent recruitment markets have been particularly damaged, amid 'low levels of client and candidate confidence'. Simon Lechipre, analyst at Jefferies, said the weaker than expected performance is particularly negative for Page Group where permanent recruitment makes up 72% of group fees. Shares in PageGroup fell 8.8% while Robert Walters dropped 4.8%. Hays expects annual pre-exceptional operating profit of £45 million, below company-compiled consensus of £56.4 million. The yield on the US 10-year Treasury was quoted at 4.39%, stretched from 4.36%. The yield on the US 30-year Treasury was quoted at 4.89%, widened from 4.86%. Gold was quoted lower at 3,368.94 dollars an ounce against 3,387.84 dollars. The biggest risers on the FTSE 100 were Melrose Industries, up 13.70p at 499.9p, BP, up 5.5p at 392.0p, Bunzl, up 28.0p at 2,250.0p, Shell, up 28.5p at 2,695.5p, and Vodafone, up 0.6p at 75.9p. The biggest fallers were Persimmon, down 50.0p at 1,317.0p, Antofagasta, down 60.0p at 1,699.0p, Anglo American, down 68.5p at 2,021.5p, IAG, down 10.2p at 309.3p, and Airtel Africa, down 5.4p, at 171.2p.
The Citizen
33 minutes ago
- Business
- The Citizen
Global Wealth Report: More dollar millionaires in SA, but also bigger inequality
The latest Global Wealth Report shows that the world became richer but it is a mixed picture, with most of the growth in North America. The Global Wealth Report for 2025 shows an increase in global wealth, but unfortunately South Africa did not share in this growth, while the country continues to be one of the most unequal countries in the world. It did, however, see an increase in dollar millionaires. UBS, a wealth manager and universal bank in Switzerland, compiles the Global Wealth Report with insights into personal wealth. The latest edition analyses 56 markets, estimated to represent over 92% of the world's wealth. The world's wealth landscape continued to evolve In a year marked by shifting economic tides and the data in the report echoes this. According to the report, global wealth increased by 4.6% in 2024 after a 4.2% increase in 2023, but it also shows that South Africa experienced negative real growth in average wealth per adult in 2023 and 2024. South Africa finds itself among the countries in negative territory for average as well as median wealth growth, alongside countries such as India, the UAE and Turkey. ALSO READ: SA still the most unequal country in the world – Oxfam Global Wealth Report shows inequality in SA In addition, South Africa ranked third-highest in the world for wealth inequality, with a Gini Coefficient of 0.81, just behind Brazil (0.82) and Russia (0.82), and equal to the UAE. This chart shows the wealth inequality in the world: ALSO READ: Six South Africans on Forbes Real-Time Billionaire list Global Wealth Report also had good news for SA However, South Africa did see a positive increase in dollar millionaires with a growth rate just under 2% but still indicating increasing upper-tier wealth and supporting the wider Everyday Millionaire trend. As an emerging market, South Africa is listed as one of the 15 emerging economies that collectively hold up to 30% of global wealth as of 2024, a statistic that has remained relatively flat since 2017. Iqbal Khan, co-president of UBS Global Wealth Management, says the speed of growth was far from uniform, largely tilted towards North America, with the Americas overall accounting for the majority of the increase, with more than 11%. 'A stable US dollar and buoyant financial markets were key contributors to this growth. Asia-Pacific and Europe, the Middle East and Africa (EMEA) were lagging behind, with growth rates of below 3% and less than 0.5% respectively.' ALSO READ: Where do the super-rich in SA live? Trends identified in the Global Wealth Report The 16th edition of the Global Wealth Report highlights these regional and demographic themes: Adults in North America were the wealthiest on average ($593 347) in 2024, followed by Oceania ($496 696) and Western Europe ($287 688). However, measured in US dollar, in real terms over half of the 56 markets in the sample not only did not take part in the world's growth last year, but saw their average wealth per adult decline. Despite this, Switzerland continued to top the list for average wealth per adult on an individual market level, followed by the US, Hong Kong and Luxembourg. Denmark, South Korea, Sweden, Ireland, Poland and Croatia recorded the biggest increases in average wealth, all growing at double-digit rates when measured in local currencies. The number of dollar millionaires increased by 1.2% in 2024, an increase of more than 684 000 people compared to the previous year, with the US adding over 379 000 new millionaires – more than 1 000 a day. The US, mainland China and France had the highest number of dollar millionaires, with the US accounting for almost 40% of global millionaires. There has been a marked and consistent increase in wealth all across the world over the past 25 years, both overall and in each main region individually. Total wealth increased at a compound annual growth rate of 3.4% since 2000. This decade, the wealth band below $10 000 ceased to be the most populated one in the sample, overtaken by the next-higher band between $10 000 and $100 000. Over the next five years, the report's projections for average wealth per adult point to continued growth, with the expansion led by the US as well as Greater China, Latin America and Oceania. ALSO READ: Bill Gates explains why his children will inherit less than 1% of his wealth This chart shows the change in total personal wealth from 203 to 2024: Khan also points out that this year's report highlights the rise of the Everyday MILLIonaire (EMILLIs), everyday millionaires with investable assets of between $1 million to $5 million. Their numbers have more than quadrupled since 2000, reaching around 52 million globally by the end of last year. This group now accounts for approximately $107 trillion in total wealth, approaching the $119 trillion held by individuals with over $5 million in assets. Khan says the growth of this segment has largely been driven by increasing real estate prices and exchange rate effects. 'Despite regional differences, the long-term upward trend in the Everyday Millionaire group is visible around the globe.' ALSO READ: Want to build wealth? This is how Differences in wealth distribution among generations The Global Wealth Report also highlights the differences in wealth distribution among generations in the US. It shows that Millennials (born after 1981) have the highest proportion of their assets in consumer durables and real estate and invest more heavily in private businesses. Baby Boomers (born between 1946 and 1964) hold over $83 trillion in net wealth, far surpassing Generation X (born between 1965 and 1980), the Silent Generation (born before 1945) and Millennials. Khan points out that globally, wealth allocation also varies, with the US standing out with its high allocation in financial investments, Australia in real estate and Singapore in insurance and pensions. 'Over the next 20–25 years, more than $83 trillion is expected to be transferred, with $9 trillion moving horizontally between spouses and $74 trillion moving between generations. The largest volume of wealth transfers is anticipated in the US of over $29 trillion, Brazil with nearly $9 trillion and mainland China with more than $5 trillion). ALSO READ: Wealth gap widens, ANC dodges wealth tax Global wealth expected to grow Robert Karofsky, co-president of UBS Global Wealth Management, says with global wealth expected to continue to grow, the ability to manage that wealth in a dynamic and complex financial environment becomes even more important, requiring strategic foresight and expert guidance. Paul Donovan, chief economist at UBS Global Wealth Management, notes that wealth is not just an economic measure but a social and political force. 'As we navigate the fourth industrial revolution and increasing public debt, the way wealth is distributed and transferred will shape opportunity, policy and progress. 'This year's report underscores the evolutionary shifts in wealth ownership, especially the growing influence of women and the enduring importance of property and long-term asset trends.'
The Citizen
33 minutes ago
- Business
- The Citizen
Post Office rescue plan slammed for lack of transparency and strategic detail
The Post Office turnaround strategy is being criticised for raising more questions than providing answers. The Select Committee on Economic Development and Trade expresses concern about the work of business rescue practitioners on the South African Post Office's (Sapo) turnaround strategy. This follows the practitioners' plan presentation in parliament on Wednesday, which outlined the progress being made. According to the practitioners, their long-term vision is to transform the Post Office into an e-commerce hub and multipurpose service centre. Concerns about further job losses and transparency Committee chairperson Sonja Boshoff said troubling realities remain. The biggest being the retrenchments of more than 4 000 employees, with no confirmation that there will not be any further job losses. 'Service delivery at the Post Office has significantly deteriorated, and the entity continues to survive on state bailouts. Public confidence has been completely eroded, and the long-term sustainability of Sapo remains in serious jeopardy,' Boshoff said in a statement on Thursday. She also raised concerns about the practitioners' request to present substantial portions of the turnaround strategy in a closed session. 'Sapo is a state-owned enterprise funded by public money. The use of in-camera briefings must remain the exception, not the rule. 'Such briefings should only be permitted in instances of legitimate commercial sensitivity – not as a tool to shield institutional failures from public scrutiny and parliamentary oversight,' Boshoff said. ALSO READ: Post Office rescue plan is working, but more money is needed Timelines and funding clarity The prevention strategy has been criticised for offering limited details regarding innovation and measurable outcomes. The committee notes that while the plan references digitisation, a revised branch footprint, and hybrid financing models, these aspects remain vague, lacking implementation timelines and funding clarity. It is troubling that no investor has yet shown serious interest in supporting the turnaround of the national postal service, Boshoff said. Unanswered questions She said the following key questions remained unanswered: How many of the retrenched employees have actually received support through the Temporary Employer-Employee Relief Scheme (Ters) fund? What efforts have been made to engage the private sector in restoring core service functions? On what basis is Sapo still classified as a 'strategic national asset' while continuing to rely on repeated state bailouts? How will the proposed hybrid funding model work in practice, and who will ultimately bear the financial risk? 'It is imperative that public institutions – particularly those under business rescue and funded by taxpayers – operate with transparency, accountability, and defined performance indicators, the committee chairperson said. ALSO READ: More millions to save jobs at SA Post Office 'A turnaround plan cannot rely on slogans or structural tinkering. It must restore credibility, modernise operations and rebuild trust with the South African public who depend on these services.' Clarity, accountability and transparency Boshoff also emphasised that as the committee continues its oversight work, it will insist on greater clarity, stronger accountability and full transparency from all parties involved in the business rescue process. 'The relevance of the Post Office in the broader communications and logistics sector is fast diminishing. 'This can only be reversed through genuine diversification of its service offering and complete modernisation of its operations,' she said. Retrenchments and saved jobs A total of 4 875 employees were retrenched in 2024 after Post Office entered business rescue, with a R8.7 billion debt. In May, it was announced that Sapo and the Unemployment Insurance Fund (UIF) agreed on a deal to fund salaries of the remaining employees while the government works to restore the postal service's fortunes. The agreement saw the return of Ters, used during the 2020 global health pandemic. Ters will inject R381 million into the post office over six months to assist 5 956 employees. NOW READ: The plan to fix the SA Post Office
Economist
33 minutes ago
- Business
- Economist
Why Vietnam's new leader is worried
Vietnam's economy may be booming—but To Lam, its new leader, isn't happy. Over the past 15 years, the country has achieved 6% average annual growth, powered by new factories—which have sprung up from Hanoi to Ho Chi Minh City—to make goods destined for export, largely to America. But many of those factories are foreign-owned and don't work much with Vietnamese firms. In addition Vietnam now risks being caught between a feuding Washington and Beijing. So what can Mr Lam do to revolutionise Vietnam's economy? Hosts: Ethan Wu and Mike Bird. Guests: David Dapice, emeritus professor of economics at Tufts University; and Nguyễn Khắc Giang, a visiting fellow at the ISEAS-Yusof Ishak Institute in Singapore.
