Anxiety about the withdrawal of support is having an impact on the world economy, as investors become more anxious about emerging markets.
India has been particularly badly hit, with the rupee plunging in recent days amid concerns over the government’s economic management.
Meanwhile, the Markit Eurozone PMI Composite Output Index signaled the largest monthly increase in business activity in the eurozone for more than two years in August.
The PMI rose for the fifth successive month, up from 50.5 in July to 51.7, the highest since June 2011. The above-50 readings signal two consecutive months of rising output, in contrast to declining business levels over the prior 17 months.
Both manufacturing and services reported higher output in August, with goods producers reporting the larger increase. Manufacturers reported the fastest growth of output since May 2011, while service sector activity showed the largest increase since August 2011.
New orders rose marginally, the small increase, nevertheless, being significant in indicating the first improvement in demand for goods and services since July 2011.
New orders for manufactured goods rose for the second consecutive month, growing at the sharpest rate since May 2011. Rising export sales were also reported for the second month in a row.
New business continued to fall in the service sector, though the decline was only marginal and the smallest in the current two-year sequence.
Employment fell for the 20th successive month, with rates of job losses accelerating slightly in both manufacturing and services compared with July. However, the overall rate at which headcounts are falling has eased since earlier in the year.
With backlogs of work falling only slightly in August, pressure to cut workforce numbers is likely to ease further in September.
Input costs rose at the fastest rate since January, buoyed to a large extent by higher oil and fuel prices. In contrast, output prices continued to fall, due in many cases to companies offering discounts to boost sales.
Germany saw output rise at the fastest rate since January as new orders posted the second largest rise seen over the past two years. In manufacturing, the PMI rose to a 25-month high, while services growth was the strongest for six months.
In contrast, France registered a faster drop in output than in July. Services activity fell at a sharper rate and there was a renewed decline in manufacturing output.
French Business Slump
France’s economy is weakening again, a survey of leading indicators suggested on Thursday, just a week after the country boasted a return to growth in the second quarter.
The forward-looking data showed that PMI for the French manufacturing sector dropped to its lowest point in two months, from 51.4 points to 48.6 points. And for the services sector, activity slipped to 47.7 points, also from 48.6 points, Reuters wrote.
A reading above 50 points suggests expansion while under 50 points indicates contraction.
“A big question mark still hangs over France’s ability to return to sustained growth,” Markit chief economist, Chris Williamson, said of the compiled eurozone data, noting that French domestic demand is ‘lackluster’.
Last week, however, data from the INSEE national statistics agency showed that France had exited from an 18-month long recession after better-than-expected growth of 0.5 percent in the second quarter.
The pickup was further supported by provisional estimates from the OECD on Thursday, which said France rallied to growth of 0.5 percent in the second quarter from a previous contraction of 0.2 percent in the first quarter, Economic Times wrote.
One of France’s main concerns is the country’s high taxes, which critics said have now reached a breaking point, although the government has refused to rule out further increases to meet its EU obligations to reduce its public deficit.
On Thursday, Foreign Minister Laurent Fabius warned President Francois Hollande to be “very, very careful”, saying “there’s a level above which we shouldn’t climb”.
Julien Dray, a local spokesman for Hollande’s Socialist Party, said there was a ‘limit’ to how far you can go, because the fiscal system gives the sentiment that those that work and invest don’t do anything else but to pay taxes.
Nigeria Needs 107,000-Km Road Network
Nigeria’s Minister of Works Arch Mike Onolememen has disclosed that to sustain an economy commensurate with the Millennium Development Goal, an increase in the total road network from the current 193,000 km to over 300,000 km is needed.
The minister, who was speaking during the Extraordinary General Meeting of the Association of Consulting Engineers, Nigeria (ACEN), also disclosed that the construction and paving of an average 14,000 km of roads every year required an estimated N600 billion per year.
The paved network of roads has to increase from the current 6,000 to over 200,000 by 2020, All Africa wrote.
The minister, who was represented by the minister of state for works, Ambassador Bashir Yuguda, stated that Nigeria cannot overcome road infrastructure development challenges unless reforms were instituted to reposition the road sector and bring it to match its peers in the developed and emerging nations of the world.
“We know that private sector involvement in the development of the road sector would not yield the desired results until the institutional reform is implemented. It is in the light of this that on October 18, 2011, I inaugurated the Committee for Road Sector Reform,” he said.
He also identified private sector participation in the development of the road sector as a sustainable approach to tackle the road infrastructure deficit, adding that the government has put in place an adequate mechanism to ensure a favorable climate for investors through the Public Private Partnership.
Earlier in his address, the president of ACEN, Nuruddeen Rafindadi, emphasized the need for the participation of private sectors and professionals in the development of the country’s road sector.
Commending the minister for efforts to bring about development of roads in the country, Rafindadi stated that the association has picked the theme, “Road Sector Reform and Engineering Practice”, for its meeting due to the importance of road sector in the development of the country.
China Manufacturing Activity Sees Sharp Rebound
China’s manufacturing activity rebounded in August, a preliminary survey by HSBC has indicated, easing fears of a slowdown in its economy.
The bank’s Purchasing Managers’ Index (PMI), a key gauge of the sector’s health, rose to 50.1 from 47.7 in July.
A reading above 50 shows expansion. For the first time in four months, the HSBC reading has passed that point, BBC reported.
China has taken various steps in recent weeks to boost economic growth--which has slowed for two quarters.
Hongbin Qu, chief China economist at HSBC, said the rebound in sector was in part due to those measures.
This is mainly driven by the initial filtering-through of recent fine-tuning measures and companies’ restocking activities, despite the continuous external weakness, he said.
The data comes amid fears that China’s growth rate--which has declined for two straight quarters--may slow further.
The world’s second-biggest economy grew at an annualized rate of 7.5 percent in the April to June quarter, down from 7.7 percent in the previous three months.
One of the reasons that played a key role in the slowdown has been the decline in demand for Chinese exports from key markets such as the US and Europe, as those economies grapple with their own set of problems.
Prompted by the slowdown in external demand, Beijing has been trying to boost domestic consumption to rebalance its economy and sustain high levels of growth.
From the start of this month, China has suspended the value-added tax and turnover tax for small businesses with monthly sales of less than 20,000 yuan ($3,257; £2,125).
The Cabinet said the move would benefit more than six million small companies and boost the employment and income for millions of people.
Beijing has also said that it will also implement measures to simplify customs clearance procedures, cut operational fees and facilitate the exports of small- and medium-sized private enterprises.
Singapore Q2 Wholesale Trade Dips
Singapore’s domestic wholesale trade dipped 1.1 percent in the second quarter (Q2), the Department of Statistics Singapore said.
Excluding petroleum, which saw an annual decline of 2.2 percent, domestic wholesale trade remained at similar level compared with the same period of 2012, Xinhua reported.
Sectors of the general wholesale trade, transport equipment and household equipment and furniture registered double-digit annual declines in domestic sales of 16.1 percent, 14.2 percent and 11.7 percent, respectively.
Two other sectors, including ship chandlers and bunkering, metals, timber and construction materials, saw relatively smaller annual contractions in domestic wholesale trade, with declines of 5. 2 percent and 3.0 percent respectively.
On the other hand, the electronic components and telecommunications and computers sectors recorded increases of 15. 1 percent and 10.1 percent respectively in domestic sales over the same period last year. Domestic sales for the food, beverages and tobacco sector also grew by 5.0 percent on year.
On a quarter-on-quarter basis, the seasonally adjusted domestic wholesale trade increased 1.1 percent in Q2 compared with that in Q1.
Annual Raisin Exports at $500m
Translated by Shahrokh Saei
Iran annually exports about 140,000 tons of raisins earning $500 million.
Asadollah Asgaroladi , the chairman of Sino-Iranian Chamber of Commerce, also said 200,000 tons of raisins are produced in the country every year, of which 60,000 tons are consumed domestically, IRNA wrote.
“Iran is the 3rd raisin exporter in the world followed by the US and Turkey,” he said.
The official added that 60 countries are permanent customers of Iranian raisins.
“In the Far East, China has been one of the major buyers of horticultural crop. Japan and India are among top target markets of our raisins, too,” he said.
Asgaroladi noted that factories cleaning and packing raisins are equipped with modern machinery, of which 95 percent pertain to the private sector.
Noting that the Middle Eastern country exported $40 billion worth of goods in the last Iranian year (ended March 20), he said dried fruits accounted for $2.3 billion of the exports.
The official named pistachios, raisins, dates and figs as major dried fruits that earned huge forex revenues.
“Pistachio is the top dried fruit export that earns $1.5 billion on a yearly basis, followed by raisins ($500 million), dates ($300 million) and figs ($100 million),” he said.
Iran, Tajikistan Emphasize Completion of Esteqlal Tunnel
Executive problems and obstacles in the way of completing the construction of Esteqlal Tunnel in Tajikistan by Iran were surveyed by the Iranian deputy energy minister and the Tajik transportation minister on Thursday.
Iran’s Deputy Energy Minister for Water and Sewage Affairs Alireza Daemi said in the meeting with Azerbaijan Republic’s Transportation Minister Nizom Hakimov that he inspected the completed sections of Esteqlal (Independence) Tunnel and surveyed various aspects of the infrastructure project, IRNA reported.
He added that hundreds of successful development projects are underway, both in Iran and abroad by Iranian technicians and engineers.
“The Iranian experts will do their best for the fast completion of Esteqlal Tunnel in Tajikistan, too, despite the heaviness of the construction operations and the natural environment problems of the region,” he said.
Daemi also referred to such obstacles as the high altitude of the tunnel, water falling from the tunnel walls, the plaster texture of many parts of the tunnel walls and the freezing temperature of the region as the most important executive problems in the way of completing the project.
“These factors have made this project distinctively different from similar projects and made the process of this tunnel’s construction incomparable with similar ones,” he said.
The Iranian deputy energy minister said the completion of Esteqlal Tunnel is of great significance for Tajikistan, as it connects the northern and southern parts of the country, and for the Iranian side, as the Iranian technicians and engineers are committed to complete their work on time.
Daemi asked Tajik transportation ministry and other concerned ministries to cooperate with the infrastructural project.
Iran’s Ambassador to Tajikistan Ali Asghar Sherdoust, while referring to the significance of Esteqlal Tunnel, said, “The construction of this tunnel is continuing, despite all the problems and hardships.”
Hakimov conferred with the Iranian deputy energy minster on the projects undertaken by the Iranian side, including the completion of Esteqlal Tunnel.
Iran and Tajikistan share historical, linguistic and cultural commonalities. Since the collapse of the Soviet Union, the two countries have enjoyed a close relationship. As of 2011, Iran is the second largest investor in Tajikistan after China.
Saudi Arabia’s foreign direct investment (FDI) amounted to $12.2 billion in 2012, which is about 25 percent down from $16 billion in the previous year.