Bellerbys Economics - Mr Stephenson

Sunday, September 17, 2006

BBC Economics

The BBC's excellent Economics site that you should try to visit as often as possible has now moved to here:

http://news.bbc.co.uk/1/hi/business/economy/default.stm

Those of you now starting module 6 should try to look at the underlying trends in any item of daily news.

For example, the news item that describes the rapid increase in trade between India/China and Africa has lots of implications for development economics. It demonstrates that India/China are following up on the policy initiated two years ago to promote trade between the BRIC countries (Brazil, India, Russia, China) and other developing countries as a way of accelerating growth in these countries. The recent free trade deal between Brazil and India is another example of this.

Also, the pressure being placed on China to increase the value of the yuan has implications for the US and China current accounts; for controlling inflation within China; for increasing the overseas purchasing power of Chinese consumers (Bellerbys courses would become cheaper!) - but also for the domestic value of China's large foreign exchange holdings which are held mainly in dollars and the competitiveness of Chinese labour costs on the world market - a big issue!

Also, the terrible news that Zimbabwe's rate of inflation is 1200% illustrates many of the points that we will discuss as module 6 unfolds.

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