2013-2014 Money to be put on hold or to be used

“Optimism is a moral duty” said Sir Karl Raimund Popper (1902-1994). Such a good tiding was not in the mind of the visual press and television channels bombarded the world with negative news.

After five years of economic crisis and the return of a recession in 2012, unemployment was hitting new peaks not seen for almost twenty years, household incomes having declined and the risk of poverty or exclusion is on the rise, especially in Member States in Southern and Eastern Europe, according to the 2012 edition of the Employment and Social Developments in Europe Review.

Financially 2013 was so bad that Belgium got in need of a new stimulant. The federal parliament has voted in favour of launching a new investment product, known as the “volkslening”, or “people’s bond”. The intention is to allow the massive sums of money currently tied up in savings accounts to be put to use to stimulate the economy. The government is concerned that the mountain of cash being put together by the inhabitants of Belgium who are afraid to invest, is doing nothing to stimulate the economy.

Koen Geens, 2011 (foto: Rob Stevens)

Koen Geens

“Savings currently sitting in accounts are fiscally over-subsidised,” Koen Geens said last week. He later said the idea of taxing interest came from National Bank governor Luc Coene. The National Bank is expected to produce a report on a proposed reform of the financial sector within the next few weeks, but whether the savings tax will be included remains to be seen. “This is a very delicate issue,” Geens admitted. At the moment a general tax of 15% is already accounted for, but the government wants to claim an other 25% tax on the futile gains on savings.

“Restrict tax advantages for savers? Out of the question,” said Open-VLD chair Gwendolyn Rutten on Twitter. “The problem is an unstable fiscal climate, not savers.”

They were joined by opposition party N-VA, whose Jan Jambon commented that “the government is once more looking for creative ways to raise taxes. Anyone who works, saves or does business is once more forced to pay up.”

Starting in January 2014, individuals can buy a bond, which has a term of minimum five years and offers a tax advantage: instead of the normal 25% tax paid on interest earned from the bond, investors will pay only 15%. Interest on the bond will be set by the banks at a market rate.

In return for allowing the government to effectively borrow from citizens, all investments in the system will be guaranteed to a ceiling of €100,000 – the same as if the money were left in a normal savings account. The bond therefore offers the same risk but a higher earnings rate than savings accounts.

The people’s bond is available at any bank for any client, staring at €200. Once invested, the money is blocked for five years.

The government of Flanders will increase the amount of funding available for social loans for housing by €100 million next year, after demand saw the budget for this year run out of money early. The loans are offered at low interest and are available in amounts up to 100% of the value of the property.

In March the European Union agreed to a €10 billion economic bailout for Cyprus. The bailout loan was equally split between the European Financial Stabilisation Mechanism, the European Financial Stability Facility, and the International Monetary Fund. The deal precipitated a banking crisis in the island nation.

The port of Antwerp handled a record amount of freight in 2013 – 190.6 million tonnes, 3.5% more than the previous year, according to the port authority’s annual report.

The port’s main business activity – container freight – fell by 1.7% or 1.8 million tonnes to 102 million tonnes. “In the circumstances, that’s an extremely stable outcome, given how neighbouring ports, including Rotterdam, saw a much more pronounced reduction,” Bruyninckx said. Bruyninckx became Executive Director of the European Environment Agency in June 2013, succeeding Jacqueline McGlade.

The most serious negative result concerned dry bulk goods, which saw a fall of more than a quarter, largely as a result of lower volumes of coal. “The explanation lies in the disappearance of markets such as Arcelor Mittal, as well as the conversion of coal-fired power stations to bio-mass,” Bruyninckx said.

Yvan Mayeur’s first day on the job as mayor of the City of Brussels, succeeding Freddy Thielemans,  included an announcement of next year’s budget, investing €45 million in the building and renovation of schools and crèches.

Brussels-Capital Region (Brussels Gewest) will provide 3,100 new computers for 391 primary schools in the third phase of the multimedia plan of minister Brigitte Grouwels, responsible for information technology.

While Flemish schools are open to children from the age of 2.5 years, in the Netherlands education only begins at four – day care must be paid until then for working parents. In addition, in Flemish schools, costs of extra-curricular activities for the year, such as museum visits, will not exceed a certain amount, fixed for the moment at €60. This makes that Flemish schools near the Dutch border are facing an influx of new pupils from Dutch homes, with more than 21,800 Dutch students registering in 2010, more than 8,000 of them in primary schools.

The two ministers want to share experiences on different strategies and introduce new arrivals from abroad to the values and norms of the Low Countries, as well as the common language. The ministries will also exchange statistics on integration, said Bourgeois.

The region also wants to work with the Netherlands on a common strategy to deal with the “negative impact” caused by the rising number of East European migrants. They hope to work more closely with other countries in the Benelux to tackle crime.

Flanders and the Netherlands have developed their own integration strategies in recent years, but many newcomers in the Low Countries remain poorly integrated, according to Bourgeois.

28,500 people last year made use of the state-owned pawn shop in Brussels, the only one in the country, for a total of €9.5 million in loans

Before the 2014 elections where many would come up with the question to get rid of the country Belgium a sixth round of reforms included the transfer of various powers from the federal Belgian government to the regional level. But, in an effort to decrease the national debt, the budget for the formerly federal responsibilities was not transferred to the regions. Therefore, each of the three regions suddenly faces a sharply increased financial burden.

Flemish finance minister Philippe Muyters

The Flemish government will now have to cover the commuting costs of civil servants based in Brussels, as well as civil servants’ pension costs and a portion of the escalating bill caused by the ageing population.

Flemish finance minister Philippe Muyters came under fire for failing to lay aside funds in preparation for the costs of the reforms. “It was impossible to prepare,” he told De Tijd, “because the reforms dragged on for such a long time before we knew precisely what they involved”.

At the moment we can still say the economy of the United States, with around 316 million people, is the world’s largest single national economy. The United States’ nominal GDP was estimated to be $16.6 trillion in June 2013, approximately a quarter of nominal global GDP. {“National Economic Trends (Nominal GDP)” (PDF). Federal Reserve Bank of St. Louis. October 1, 2013. p. 24. Retrieved October 26, 2013. + United States”. International Monetary Fund. Retrieved October 26, 2013.}
Many consider that 2013 was a good year for the the US economy and experts are predicting an even better year for 2014. The United States finished last year with a two percent growth rate and an inflation rate below two percent. The labour market continued to improve, and the housing industry was also showing more activity.

Though we must see that Global growth is still in low gear, and the drivers of activity are changing. curiously we may wonder how it would turn out and giving new dynamics to raise new policy challenges.

Advanced economies are growing again but must continue financial sector repair, pursue fiscal consolidation, and spur job growth. Most governments must convince their population that they should trust the uprising economy and should spend again some of their money. Putting most of it in a savings account will not help the economy to rise up from the gutter. to get the public thinking more positively the ministers themselves should talk more positively.

On July 1, 2013, Croatia became the 28th member state of the European Union.

At the end of the year European Council president Herman Van Rompuy tried to get people looking for a brighter future, getting them to see the end of the tunnel. when we look at the Euro-strugglers Spain and Greece, which took not liked measures, but got their countries a little-bit more forwards.

While 2013 saw European Union nations overcome the crisis, 2014 will be the year of revival though this is not yet visible in continuingly poor unemployment data, Van Rompuy said. Both Spanish and Italian PMIs had their best months since Spring 2011. Germany remains solid.  I wonder how a stop to lay of workers can be created. Creating jobs will require more time, said Van Rompuy, who is currently working on a book to be titled “Europe after the storm”.

While this year saw EU nations overcome the crisis, next year will be the year of revival though this is not yet visible in continuously poor unemployment data, he said.

“In the eurozone, except Slovenia and Cyprus, we will go to positive economic growth,” he added, referring to the 17 nations currently sharing the euro. Greece is hoping to return to bond markets in the second half of next year — but only if growth and a primary budget surplus permits, the Greek finance minister said on the 29th of December.

“We are preparing a return to the markets in the second half of 2014,” Yannis Stournaras said in an interview published in the Realnews weekly. However, he stressed that was conditional on economic growth and a budget surplus not counting debt servicing costs.

The sick man of Europe ever since it almost crashed out of the eurozone in 2010, Greece has been shut out of mid and long-term bond markets and has relied on bailout funds from the EU and the IMF.

It has only been able to issue short-term public debt notes.

Government forecasts predict a primary budget surplus of 3 billion euros (US$4 billion) next year, after a surplus of 812 million euros this year. It also figures on a return to growth, of 0.6 percent, after six years of recession.

Van Rompuy brushed off fears that elections to the European Parliament in May will see a sharp rise in eurosceptic populist parties.

“Euroscepticism is something of all times,” he said, pointing to the longtime popularity of France’s former far-right leader Jean-Marie Le Pen, who has been succeeded by his daughter Marine Le Pen, who was invited in 2013 by the Vlaams Belang to tell the Flemish population how Flanders could exist on its own and did not need a European Union.

“I am convinced that an overwhelming majority of Europe’s population favours the EU, even if euro-adverse parties form a strong minority,” he said.

We had already Korean cars in Belgium and now the Chinese and Indian cars started to catch the eye of the Belgian public.

The sovereign state located in East Asia, China with a population of over 1.35 billion was not so much interested in the well being of the general public, which was moved from one place to an other for the better of the economy, even when it made the people worse off. The regional power may soon turn over to become the potential superpower to be looking out for.

Earlier this year there was serious concern about a hard China fall, but the recent data has eased those concerns somewhat.

Li Keqiang 2012.jpg

Li in May 2012, giving a speech regarding urbanization.

The economist by training Li Keqiang became Premier of the People’s Republic of China and party secretary of the State Council. Li called for frugality in government, a fairer distribution of income and continued economic reform. He has focused his attention on China to move towards a consumption based economy instead of relying on export led growth.

They should not only try to get “quality” growth (i.e. growth that’s not just driven by aggressive investment), but should invest more in decent work-circumstances and respect for the working force. It may look that we could perhaps see a push to reform and crack down on corruption, which we’re seeing in the newsflow coming out of the country. So China might not be the voracious consumer of the world’s commodities quite the way it used to be, but a full-on meltdown in the world’s most populous country doesn’t seem that likely either.

The documentaries we got to see about the economic and of the living condition position of the labourers in India and Bangladesh should make people in the industrialised West to consider what they can buy or not buy for not helping the slavery work.

India had its worst PMI Manufacturing report in years, and Indonesia whiffed on a trade number. The Jakarta Market fell 2.6%. The question is not whether the scene is bad, but whether things develop into a real “crisis.” So far, the thinking seems to be that this doesn’t have to be an actual crisis-crisis, a la the late 90s.

We may have the tantalizing prospect of all of the major economies: Japan, Europe, the US, and China in a state of decent growth, which would be something we haven’t seen at all since the 2008-2009 global economic crisis. Euro zone showing the fastest manufacturing growth since mid-2011. Perhaps Europe has turned the corner at last.

Euro zone manufacturing grew at the fastest rate since mid- 2011 in December on brisk business in Germany and Italy, Markit Purchasing Managers’ Indexes (PMIs) showed. Add in the fastest growth in 7 1/2 years for Japanese manufacturing and no major slowdown in Chinese manufacturing output, and the stage is set for a solid start to the year.

“Looking ahead, the hope for the euro zone is that recent improved confidence will encourage businesses to lift their employment and investment plans as 2014 progresses, and will also encourage consumers to spend more,” said Howard Archer, the chief European and UK economist at IHS Global Insight.

+

Preceding articles with the annual review:

2013 insecurity

Human relations 2013

People of 2013

Environment in 2013

Find:

  1. www.volkslening.be
  2. Extra funding for social loans
  3. Computers for Brussels schools
  4. Dutch line up for Flemish schools

While this year saw EU nations overcome the crisis, next year will be the year of revival though this is not yet visible in continuously poor unemployment data, he said.

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About Marcus Ampe

Retired dancer, choreographer, choreologist Founder of the Dance impresario office and archive: Danscontact-Dansarchief plus the Association for Bible scholars, the Lifestyle magazines "Stepping Toes" and "From Guestwriters" and creator of the site "Messiah for all". - Gepensioneerd danser, choreograaf, choreoloog. Stichter van Danscontact-Dansarchief plus van de Vereniging voor Bijbelvorsers, de Lifestyle magazines "Stepping Toes" en "From Guestwriters" en maker van de site "Messiah for all".
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3 Responses to 2013-2014 Money to be put on hold or to be used

  1. Pingback: 2013 Lifestyle, religiosity and spirituality | Marcus' s Space

  2. Pingback: Inequality, Injustice, Sustainability and the Free World Charter | Marcus' s Space

  3. Pingback: Forms of slavery, human trafficking and disrespectful attitude to creation to be changed | Marcus Ampe's Space

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