Illicit trade is a persistent and growing threat, as technology, the global economy and e-commerce open new opportunities for counterfeit products to infiltrate supply chains and provide consumers with illicit products. Many understand the risks—that illicit trade can cause serious public health issues, and that the proceeds from illicit sales fund other criminal activities. Others view some form of illicit trade as the soft underbelly of the global economy— the price to be paid for frictionless trade.
A new study from Oxford Economics seeks to understand this evolving issue better—specifically, the attitudes and behaviours of those that influence the demand and the supply for illicit goods, so that illicit trade can be contained. We surveyed more than 37,000 consumers, across 37 European countries, buying five products; cigarettes and tobacco, alcoholic drinks, films, music and games, clothing and accessories and medicines.
Public policy and regulations,
Markets’ attention in recent weeks and months has been focused intently on central bank policy actions as the US Federal Reserve and European Central Bank have pressed ahead with further moves toward ending the era of historically low interest rates and easy money. Yet beneath the surface of the world economy, potent trends in global liquidity driven by the vast capital flows across fixed income markets have commanded far less scrutiny – despite far-reaching implications.
A large liquidity squeeze looms, with equally large potential consequences. Cross-border bond purchases by fixed income investors could plausibly drop by more than half this year and next, to an average of only $500 billion a year, versus 2017’s tally of $1.2 trillion.
Global survey shows how open-plan layouts threaten employee wellness and productivity while failing to deliver on collaboration, growth and other critical business goals—and what companies can do to address these issues
HR, Talent, and labour,
Organisation and operations,
Business and economic outlook,
Modern economic history since the 1970s is littered with episodes of oil shocks, with surging crude prices triggering global recessions. With the cost of benchmark Brent crude having surged by 62% over the past year or so, to levels around $77 a barrel, anxieties are mounting over the implications. So just how serious is the bad news from the black stuff?
Oxford Economics recently raised our baseline forecast for oil to $85 a barrel in the second half of this year. And oil price spikes remain one of the fastest and most potent redistributors of income, wealth and capital that the global economy can throw up.
Yet, in spite of this, we remain relatively sanguine over the fallout from this episode of sharply higher oil prices, and we see a series of reasons to be less pessimistic this time around.
crude oil prices,
Is the world economy’s current, long-running upturn running out of steam? Jittery financial markets that have struggled to regain a firm footing since February’s sell-off, anxieties over the US-China trade tariffs confrontation, and now a spate of weaker data for some major economies have all sparked concern over whether the global economy’s expansion may be stuttering or at risk.
Global Economic Model,
Over the next decade, a great wave of technological change will wash through the economy, transforming the nature of work and the shape of the labour market. In a recent study we carried out in partnership with Cisco, we built a brand-new modelling framework to explore the implications of this change in a more comprehensive way than ever before. We simulated the real-world dynamics of technological change and its interaction with the labour market and found that 6.5 million US workers will have to seek out a new profession over the next decade.
But what significance does that number have? Our bottom-up approach to understanding the evolution of the labour market around this technology trend enables us to identify what needs to be done to meet the needs of the future economy. After all, at the macroeconomic level, our ability to take advantage of the opportunities technology presents will be defined by how smoothly those 6.5 million workers make the transition from the old to the new.
Here are our seven key implications for the future of work:
Chinese consumer market to overtake America’s by 2034
“Let China sleep, for when she wakes, she will shake the world.” The cautionary words of Napoleon have echoed ever more powerfully as China’s economic and political power has burgeoned over recent decades.
And with the seismic impact of the world’s most populous nation set to resonate ever more strongly than ever in coming years, in few areas of life will those reverberations be felt more than in the rise of China’s consumers as a global force.
As winter turns to spring, around the world investors are anxiously watching the present spasm in global equities and bonds and asking themselves whether the bears of the financial markets are finally waking from a long hibernation.
We think not. To us, a correction of the sort seen in recent days was overdue and a jump in volatility along with this sort of adjustment in equity valuations was just a matter of time. The pretext and triggers were, and remain, less important – stretched valuations in equities often find their own triggers for such an upset.
Companies’ spirits boosted by buoyant world trade and US fiscal stimulus measures as fears over North Korea tensions and China slowdown retreat
Businesses are increasingly positive about prospects for the world economy, with optimism over the global outlook at its strongest for two years, according to Oxford Economics’ latest survey of global risk perceptions among clients and business contacts, including some of the world’s largest companies.
Business and economic outlook,
US tax cuts,
How our EPRE risk tool helps keep users on their guard in a volatile world
The upsets and surprises of the past 12 months show all too clearly how, in an ever more unpredictable world, risk can catch out the unwary. And, as we begin 2018, nowhere is this more apparent than in the realms of economic and political risk.
As one of the world’s foremost independent economic forecasters, Oxford Economics has collaborated in a joint venture with Control Risks, the global specialist in political and security risks, to create a unique tool for organisations to weigh-up the uncertainties lurking in every corner of a volatile globe.
China’s cities’ GDP to double, and will outstrip Europe’s and North America’s by 2035. But New York, Tokyo, London and LA to stay as world’s urban superpowers as Shanghai closes in.
The world is ever more urban. The top 780 global cities already produce almost 60 per cent of all world economic activity, and they are set grow in importance as urbanisation continues.
By 2035, these cities will be home to almost half a billion additional people with their GDP rising by $32 trillion (constant 2015 prices and exchange rates).
We head into 2018 in a fairly optimistic mood. The current global economic upswing is more broadly based than any other since the global financial crisis, and – unusually, by recent standards – the new year approaches without any major crisis looming.
In our latest forecasts, we see world GDP growth accelerating from 2.9% this year to 3.2% in 2018. This would mark the best year for the world economy since the rebound from the global financial crisis began.
Business and economic outlook,
It is plausible that recent low volatility is the new and persistent norm, with economic surprises muted and downside risks in decline.
As a tempestuous year in world politics comes to an unnerving close, in economics the nervousness flows from an almost entirely and strangely opposite cause. 2017 ends as the year of the risk conundrum.
Even as the advent of the Trump Administration, the UK’s great Brexit gamble, and the rise of populism and separatist tendencies in parts of Europe have raised the global political stakes, in the global economy both macro and market volatility have recently plummeted. Conditions, in fact, appear more stable than during the period of the Nineties and early 2000s, which itself became known as the ‘Great Stability.
The UK launched its Industrial Strategy yesterday, seeking to tackle the UK’s pervasive slow productivity growth. Developing technical skills is one of the key recommendations, through increasing teaching of STEM subjects, enhanced Computer Science education and “T levels,” the establishment of a National Centre for Computing Education and an Institute for Coding. Coincidentally, last week BT and Accenture launched their study “Tech know-how: The new way to get ahead for the next generation.” Though they both seem on the same page in promoting tackling technology skills shortages, there are important differences in emphasis.
Lost amid Europe’s political drama and recurrent euro doomsday scenarios is the fact that the Eurozone economy has a business cycle that is alive and well.
Our analysis suggests there is plenty of room left in the current expansionary cycle, which could see the single currency area enjoy a golden decade of economic growth.
More than four years into the current upturn, most indicators signal the Eurozone economy is still somewhere around mid-cycle, suggesting that – absent an unexpected shock – we should see several more years of sustained expansion.
One reason is that the amount of economic slack in the Eurozone countries – the size of the “output gap” before an economy hits a ‘speed limit’ above which growth comes with inflation – may be larger than commonly accepted.
Business and economic outlook,
Global Economic Model