Entries tagged with “economy”

Articles

23 articles found for economy:

  • Green Hydrogen in Circular Economy

    The urgent need to reduce greenhouse gas emissions has prompted countries worldwide to commit to net-zero targets, driving the rapid adoption of low-carbon and renewable energy sources. Green hydrogen, generated from solar and wind power, has immense potential in sectors that are difficult to decarbonize. However, challenges related to costs, infrastructure, and policy intervention hinder its progress. Improving process efficiency, achieving cost efficiency through technological advancements and scale, transforming infrastructure, and implementing supportive policies are crucial for the widespread adoption of green hydrogen as a clean energy solution in the transition to a circular economy.

  • The Cost of Inaction: How Climate Change Impacts Farmer Livelihoods

    Climate change has caused severe environmental degradation and altered global weather patterns. This has resulted in significant impact on food production, affecting farmers worldwide. In India, agriculture is a critical economic sector, with small and marginal farmers forming a major part of it. Climate change affects various aspects of agricultural production, including rainfall, pest proliferation, soil quality, cropping patterns, and harvest unpredictability, leading to decreased yields and increased costs. The government's initiatives to support farmers in coping with climate change have faced challenges, necessitating sustainable farming practices and increased support to ensure food production.

  • Shrinkflation in the US

    Shrinkflation is a form of inflation where companies reduce the product size, quantity, or quality to maintain or increase their profit margins. A common practice during high inflationary periods, shrinkflation is preferred when companies are hesitant to raise product prices amid rising operating costs. To avoid facing consumer backlash, companies sneakily practice shrinkflation, which, coupled with consumer ignorance, makes it hard to detect. Consequently, consumers may end up purchasing two packets of a product, for example, if its size is reduced by fourth. Thus, shrinkflation may not only help in maintaining margins but also boost sales. When accused of shrinkflation, companies may give several reasons such as health, environment, and better value addition. Inflation is transparent, but shrinkflation is underhanded and thus could be difficult to calculate and tackle.

  • Megatrends in 3D Printing - Sustainable Materials

    The 3D printing industry is embracing several strategies to make itself more sustainable. Manufacturers are providing plant-based materials, biodegradable materials, recycled materials, and innovative formulas. Adopting a circular economy model, choosing environmentally friendly materials, and reducing the environmental impact of materials are key strategies focusing on sustainability.

  • US Economic Slowdown – An Opportunity for India?

    As the US economy edges toward recession, equity investors are seeking opportunities in other countries. The focus is on emerging economies, specifically in Southeast Asia, and the main contenders are China and India. Both countries have positive and negative factors influencing investor decision. Which country would attract the bulk of the diverted investments is yet to be seen.

  • DeFi – Revolutionizing Financial Markets

    DeFi has made considerable progress in a surprisingly short time that would contribute to a more transparent and accessible future in finance due to rapid technological developments. There are now over 4.5 million DeFi users worldwide, which is anticipated to reach two-digit millions in the immediate future. However, the technology seems to be in a nascent stage and is yet to be fully stress tested at scale over an extended period. While there are concerns over DeFi replacing the traditional financial system, experts suggest they can coexist and thus improve the global finance architecture and benefit the economy worldwide.

  • Mexico – A Promising Sourcing Destination for US Procurement Organizations

    With the global supply chain disruptions, countries are looking to develop strong supply base near to them. For the US, Mexico has emerged as a strong contender. Many drivers contribute to the country being a preferred option. The number of collaborations and trading transactions between the two countries rose in the past year, and this will only increase further. In this article, we discuss why sourcing from Mexico is an attractive option for large US organizations to procure key categories such as metal & electronics components, automotive parts, and other manufacturing products.

  • The Current Real Estate Turmoil in China

    China’s real estate sector is in turmoil due to various factors, ranging from low investment to declining trade numbers. It has far-reaching implications and is threatening the country’s economic growth. Therefore, the government has undertaken certain policy measures to limit the damages. However, a more extensive plan is needed to deal with this issue effectively.

  • Downward Spiral of Tech Industry Valuation

    The Indian tech industry has always been a strong player with consistent growth, but 2022 was a challenging year, and many companies saw a fall in their valuations. This was attributed to factors such as fear of recession fueled by rising interest rates in developed markets, which hampered the revenues, sales, and growth prospects of many tech firms worldwide, including India. Whether it is a short-term effect or will India’s IT sector suffer long-term consequences is yet to be seen.

  • Can ChatGPT Disrupt Financial Services?

    Generative artificial intelligence (AI) tools, including ChatGPT, have led to increased adoption of AI in financial advisory and risk management. These tools have the potential to address issues related to operational inefficiencies, fraudulent activities, and the need for personalized services. However, it is important to recognize that ChatGPT has limitations, and human intelligence and judgment will continue to be crucial for decision-making.

  • Nurturing Sustainability Across the Supply Chain

    It has become increasingly imperative for companies to embed sustainability throughout the supply chain. Companies are recognizing the need to connect with their tier-1 and tier-2 suppliers, adopting measures such as decarbonization initiatives and incorporating green packaging materials. By doing so, they aim to reduce their environmental impact and create a more sustainable value chain. Through collaborative approaches and the involvement of experts, organizations are better positioned to navigate the complexities of sustainability and make meaningful progress in embedding sustainability across their entire supply chain.

  • Exploring Financial Performance Trends of Leading Japanese Corporations

    The Nikkei 225 functions as the principal index in Japan. It is constituted of prominent corporations within the nation, which collectively generated JPY 596 trillion in revenue during the fiscal year 2023. These companies have demonstrated exceptional financial performance last year, and indeed, over the past five years. The article highlights some interesting insights on their performance over the last fiscal year and preceding five-year period.

  • Shifting Tides: The Silent Rise of De-Dollarization

    The US dollar has been the world's dominant reserve currency for decades, with countries around the globe holding large amounts of it to facilitate international trade and investments. However, the trend toward de-dollarization has been growing recently, as countries seek to curtail their dependence on the US dollar and diversify their reserve holdings. Will the dollar be replaced as the global currency?

  • Friendshoring: Strategy to Reduce Supply Chain Dependency on China

    Supply chains globally have barely recovered from the unprecedented challenges posed by the pandemic. The Russia–Ukraine war has added to the woes of already fragile supply chains. The only silver lining is that companies realize the perils of relying on a select few countries for manufacturing, raw materials, and components. For decades, companies have followed strategies such as offshoring, nearshoring, and outsourcing business operations to low-cost countries. However, recent events accelerated the movement to safeguard supply chains and move away from depending entirely on countries like China. One such concept that could be a game-changer for global trade order is “Friendshoring.”

  • COP28: Green Tech Takes Center Stage as Funding Paves the Way for Biotech Solutions

    The dust has settled on COP28, and amid the flurry of pledges and promises, one theme stands out: biotechnology and green manufacturing are emerging as the keystones of the fight against climate change. This article delves into the funding commitments made at the conference and explores how these innovative solutions can empower companies and countries to achieve their ambitious climate targets.

  • Decarbonization of Natural Gas at Pre-Combustion Stage

    Decarbonization is becoming increasingly urgent because of the rise in global warming. Given the substantial utilization of natural gas by corporations in the US and Europe, this need has become notably more significant. Currently, the adoption of renewable energy sources stands out as the most relevant method for mitigating carbon emissions. However, limited availability of renewable energy supplies and declining levelized cost of energy (LCOE), has increased per unit cost of green energy, thereby compelling companies to sustain considerate consumption of natural gas. Companies can adopt other techniques for decarbonization, such as carbon capture storage/utilization (CCS/CCUS), as a feasible option to eliminate carbon dioxide content of natural gas. However, due to high costs associated with carbon capture and storage, evaluating certain other future ready techniques, such as methane processing, to decarbonize the balance usage of natural gas is necessary. 

  • Redefining Comfort: Exploring the Evolving Trends in the Mattress Market

    As technology and consumer preferences evolve, the mattress market is undergoing a transformation that extends beyond traditional notions of comfort. From personalized sleep solutions to sustainable materials, this article delves into the dynamic landscape of mattress trends. These changes, driven by evolving customer needs or the adoption of different business models such as direct-to-consumer, highlight a shift toward customized and eco-conscious sleeping experiences. Here, we uncover how brands redefine comfort to align with modern lifestyles and desires and aim to build relations with customers.

  • Reshoring in US: Need for Locally Resilient Supply Chains

    US companies are increasingly reshoring their operations from China in response to supply chain disruptions and global uncertainties. CEOs in the US are investing in emerging technologies to enhance productivity and gain a competitive edge. The reshoring movement aims to build locally resilient supply chains and mitigate future risks. By adopting reshoring, the US can strengthen its manufacturing sector, foster economic growth, and create sustainable jobs.

  • Mexico's Nearshoring Promise to Supply Chain Adversities

    As the world navigates a series of supply chain disruptions, staying ahead of the curve is crucial. Exploring nearshoring opportunities becomes increasingly important to mitigate risks and build resilience. Mexico is emerging as a promising nearshoring destination to global companies (especially in North America) due to inherent benefits such as logistical proximity, reduced lead times, cost efficiency, and strategic trade relations. Procurement organizations have actively embraced Mexico, making regular investments, expanding capacities, and fostering supplier partnerships to reap the benefits of nearshoring. Are you prepared for nearshoring to build a resilient supply chain strategy?

  • Innovation and Sustainability: Setting New Standards for Tailings Management

    Though metals and minerals are essential for human progress, the process of mining them is harmful to the environment. The byproduct of mining – tailings – are toxic and their disposal must be managed correctly. Conventional tailings storage and management methods are risky and inadequate for their safe disposal. However, modern methods of tailings management can overcome the shortcomings of the current process and prove more feasible.

  • Metaverse-as-a-Service (MaaS): Raising the Bar of Web 3.0

    While the term ‘Metaverse’ is getting a lot of publicity, the concept is still in its infancy. User experience in Metaverse is still developing and is expected to reach phenomenal heights in future. The online world has gone beyond purchasing licenses or setting up software on computers. Nowadays, businesses do not even own or manage their gear; everything from software to document storage to infrastructure hardware is offered "as a service". Therefore, MaaS, or metaverse-as-a-service, is the logical next step. MaaS offers a platform to pilot early concepts by enabling the use of metaverse for branding and marketing.

  • Carbon Capture – Moving Toward Net-Zero Emissions

    To save the planet from climate change, countries and organizations are working toward achieving net-zero emissions. Capture, utilization, and storage of carbon emerged as a leading strategy for limiting the global temperature rise. However, these technologies are expensive to implement in factories and manufacturing facilities. In addition, each technology comes with its set of limitations. If these obstacles can be surmounted, carbon capture can be widely implemented and contribute to a positive environmental impact.

  • US Pet Food Industry on the Rise

    Pet ownership increased during lockdown when people were confined to their homes. Pet humanization has led to owners treating pets as part of their family. Owners are increasingly concerned about their pets’ health and nutrition and are looking for high quality and nutrient-rich food products. Pet food manufactures have been quick to tap into this rising demand to develop organic, natural, and high nutrition products. According to the American Pet Products Association, pet food sales increased 19.3% year-on-year to USD123.6 billion in 2021. Large pet food and treat manufacturers are expanding their production lines to meet growing demand. The pet food industry has shown resilience during the recent economic downturn and is expected to grow further.


Special Reports

8 special reports found for economy:

  • US Legislative Drive for Sustainable Economic Growth

    The US senate have passed three legislative bills - Infrastructure Investment and Jobs Act (IIJA), the CHIPS and Science Act of 2022 and the Inflation Reduction Act of 2022 in an effort to strengthen the US economy, combat climate crisis; and rebuild and modernize the US infrastructural landscape. This special edition provides the detailed insights on the three legislative bills passed by the US senate and captures the impact on sectors and the US economy.


  • Q2 2023 Global Macro Report

    Q2 posted a slowdown in global economic growth along with strong returns in risk assets. The IMF expects global growth to be lower in 2023 than 2022 for most advanced countries. It also expects headline inflation to decline owing to the aggressive monetary policies of major central banks, but core inflation may decline slowly. Chinese economic recovery seemed to have run out of steam after the initial reopening thrust, as shown by the decline in inflation, retail sales and PMI numbers.

    Regarding asset class returns, equities rallied during Q2 due to strong corporate earnings in Q1, slowing inflation, a resilient US economy, and the AI theme. China’s sluggish recovery led emerging market equities to underperform developed market equities. Bonds gave a mixed performance with most yields increasing to price-in high rate expectations as central banks continued their hawkish policies. High yield bonds performed well despite their historically low yields. The US Dollar strengthened while gold price declined as the US Federal Reserve increased rates. Oil prices fell as expectations of a global economic slowdown loomed over investors.

  • China's Economic Slowdown - The Property Crisis as a Drag on Growth

    The slowdown in China can be linked to several factors, including the zero-COVID policy which aimed at curtailing the spread of the virus with China being one of last countries to withdraw the policy; poor consumer spending which was expected to inverse post the lift-off of the Zero-COVID policy and rising youth unemployment which narrowed consumer spending even further. The property sector, which accounts for about a quarter of China’s GDP and a major component of household wealth, slumped in the recent years due to its highly leveraged functioning pattern. This caused big players in the construction industry to default on debt obligations with majority of it being offshore bonds. The property sector crisis spilled over other sectors of the economy, such as the financial sector which faced the risk of contagion and systemic instability; the industrial sector that faced the risk of overcapacity and deflation; and the consumer sector faced the consequences of lower consumer confidence and spending. The slowdown had significant implications on the global economy, trade, investment, and innovation, as well as for China’s domestic stability and development goals. The IMF recently lowered its growth projections for China, putting it at 4.2% in 2024 and about 5% this year. Moreover, rating agencies downgraded outlook on China's government credit ratings to negative from stable. To support an economic recovery in 2024, the Chinese government pledged to spur domestic demand, resolve the country’s spiraling real estate crisis, expand high-level foreign investments, diffuse risk related to local government debts, and prioritize the development of strategic sectors. The government also emphasized on strengthening macro policies, while continuing with its proactive fiscal policies and prudent monetary action.

  • Global Private Equity Factbook – Q1 2022

    Global PE activity weakened in Q1 2022 due to the uncertain macroeconomic and geopolitical factors. Deal activity is expected to remain slow in the short run and likely to pick up as the global economy recovers in H2 2022.

    In Q1 2022, PE deal volume fell as PE investors remained cautious and invested in big-ticket deals, driven by IT, financial services, and energy sector. Exits declined significantly as macroeconomic factors such as inflation, rising interest rates, and Russian–Ukraine war impacted valuations. 

    The momentum of investment activity is anticipated to remain slow in the coming quarter and pick up by the end of 2022 as the global economy stabilizes.

    This edition of the Global Private Equity Factbook offers insights on global PE investment activity, features the key sectors targeted, and provides an outlook for this industry in the coming quarters.


  • Islamic Finance

    The global Islamic finance industry is worth over USD2 trillion and is projected to grow to ~USD5 trillion by 2025. However, the global economy has been severely impacted by the pandemic, volatility in oil prices, and uncertain macroeconomic environment (Russia-Ukraine war, possibility of another recession). Thus, the Islamic finance industry's development and expansion will be challenging over the next few years. Most of the sustainability efforts are led by governments globally. However, environmental preservation and social development targets are shared responsibilities of public and private sectors. Accordingly, the scope of Islamic finance is not limited to raising debt. Islamic finance now contributes to building a greener planet via funding sustainable businesses, which will benefit from perks such as lower interest rates compared with those for conventional debt.


  • Exploring the Rise and Impact of US RIA

    There has been a global shift in recent times to clean technology as advancements in electric vehicles (EVs), as well as solar and wind energy, gain momentum. However, there are several limitations in the existing energy-storage mechanism. Lithium-ion batteries are primarily used for energy storage, but lithium is scarcely available and highly expensive. Additionally, such batteries are relatively unsafe, and there have been several reports of batteries overheating and bursting. Sodium and zinc batteries are good alternatives to overcome these issues. Both metals are more widely available than lithium and cost less. However, their lower density means that sodium and zinc batteries would be larger and heavier. Therefore, such batteries could be used in applications where stationary energy is possible or in EVs, with limited mobility. Startups and well-established firms are making significant investments in the development of sodium and zinc batteries and are likely to reap strong returns.

    In the ever-evolving landscape of personal finance, individuals seek not only financial stability but also strategic guidance to optimize their investments. This is where Registered Investment Advisors (RIAs) emerge as key players in the financial ecosystem. RIAs, regulated by the Securities and Exchange Commission (SEC) or state authorities, offer personalized financial advice and comprehensive wealth management services, putting the client's interests at the forefront. In the dynamic landscape of financial advisory services, the United States takes center stage as the epicenter of Registered Investment Advisors (RIAs). With over 96% of RIA firms based in the U.S., their influence extends globally, managing an impressive 90% of the world's managed assets. In 2022,  the sector, consisting of 15,114 advisers overseeing $114.1 trillion for 61.9 million clients, experienced a growth of 2.1%. Despite challenges from an unstable global economy causing a decline in assets under management for the first time since 2008, Registered Investment Advisors (RIAs) persevered and maintained their success. The RIA industry is witnessing transformative trends, characterized by a robust merger and acquisition market, the emergence of new industry players, advancements in AdvisorTech, and evolving client expectations.





  • High Yield – US Spotlight

    After recording a plunge in the US high yield bond returns in 2022, the Federal Reserve’s aggressive monetary policy stance to tame inflation proved crucial in driving asset prices in 2023. The possibility of a soft-landing, where the US Fed could afford to slowdown economy and avoid a recession, has favored higher-beta fixed income assets such as the US speculative grade corporate bonds. We observed this in 9M’23, where the US high yield corporate bond Index generated returns at ~6% whereas the US Investment Grade Bond Index remained flat. Barring Equity and Energy, the US high yield corporate bonds outperformed other asset classes like the US treasuries, gold, and metals. As recessionary fears subsided, spreads across all rating categories of the US high yield bonds (i.e., BB, B, CCC and lower) have tightened. However, due to higher borrowing costs, the number of High Yield Corporate Bond issuances remains below the five-year average. Notably, consumer discretionary and healthcare sectors remain challenged by multiple headwinds, such as muted consumer demand, pricing pressures, high labor costs, and rising input costs. The impact is witnessed from the fact that a major chunk of bankruptcy protection filings has been in these sectors. Overall, bankruptcies in YTD Aug’23 have surpassed 2021 and 2022 levels. We still see value in the real estate, materials, and utilities sector, which recorded relatively lower bankruptcies in 2023.

  • India's EMS Sector in Full Momentum

    COVID-19 pandemic and higher China dependency led to supply chain disruptions in electronic components and finished goods. Consequently, the global electronic manufacturing giants reduced dependency on China by shifting their manufacturing bases to countries such as India, Vietnam, Indonesia, which have better unit economics. We believe India will benefit from this electronics manufacturing (EMS) wave, given its: i) digitized economy driving domestic demand; ii) 1.8–6x cost effective and skilled labor vs Vietnam and China; iii) high import bill (53% of total electronics market) leading to import substitution; iv) China+1 strategy; and v) robust government initiatives to push local manufacturing.  The EMS wave kick-started in India following government announcements to push local manufacturing in FY20. As a result, the electronics import/export ratio reduced sharply from 8.3x in FY18 to 3.2x in FY23. This has resulted in a 2–5x increase in book-to-bill ratio of major India-based EMS companies, along with a rise in the entry of global manufacturing giants; Foxconn and Pegatron have announced plans to double operations in India over the next couple of years. 

    We believe that India is ready to be the next EMS hub. India’s EMS market of $20bn (2.3% of global market) is poised to expand at 32% CAGR over CY21–26E and outpace global/USA/China/Europe markets. Kaynes, Syrma, Avalon and Dixon, which are some of the leading listed EMS players in India, are likely to benefit from this EMS wave.