China aims for faster and higher quality growth with its recovery and modernization move
While China, the world’s second largest economy, is gaining momentum to increase its recovery momentum and take its modernization move forward, it aims for a faster economic growth of about 5 percent in 2023 with more qualified development.
This projected target, higher than the country’s 3 percent growth in gross domestic product (GDP) last year, was one of the key development goals in the government work report presented by Chinese Premier Li Keqiang at the national legislature’s annual session, which began Sunday.
As national legislature delegates and political advisers gather for the first annual meeting since the 20th National Congress of the Communist Party of China (CCP) in October last year, the world is closely watching new policy moves for China’s development. On the other hand, the rapid recovery of the country after the Kovid-19 pandemic has increased the hopes for a wider global growth and made this meeting even more important.
Ensuring stable and quality growth is key to the CCP’s plan to build a large and modern socialist country by the middle of this century.
China’s National Development and Reform Commission (NDRC), the top-level agency in charge of economic planning, reported on Sunday that at the 20th CCP National Congress, the country’s GDP per capita will reach the same level as a mid-level developed country by 2035. It was noted that the introduction of “It is imperative that we maintain reasonable long-term economic growth, sustaining our miraculous achievements in rapid economic growth and long-term social stability while ensuring better quality and efficiency,” the report said.
According to the NDRC’s report on the implementation of the 2022 national economic and social development plan and the 2023 national economic and social development draft plan, a growth target of about 5 percent is “necessary to achieve growth, employment and price stability”.
“This growth target will send a positive signal to the market and increase confidence, guide expectations, expand employment, improve living standards and prevent and neutralize risks in the pursuit of development,” the NDRC report said.
According to the report, this year’s GDP target is consistent with the current growth potential of the Chinese economy and the capabilities of resources and production factors to support the economy.
“For China, 2023 will be the year of economic comeback,” said Liu Shouying, Dean of the Faculty of Economics at Renmin University, China.
According to Liu, the annual GDP target is an appropriate growth rate to stabilize prospects and economic expansion, and an indication that the Chinese economy will continue to focus on high-quality development.
Expressing that the Chinese economy showed a decisive recovery with a significant improvement in consumer demand, market distribution, industrial production and job prospects, the Chinese Premier noted that the economy showed great potential and momentum for further growth.
It is possible to see and feel the recovery on the roads with heavy traffic, in crowded cinemas and restaurants, and in the shopping spree both online and in stores. Manufacturing activity has returned to its highest level in more than a decade, foreign investment growth has rebounded, and new monthly bank loans rose more than expected, according to the latest official data.
While acknowledging past successes, Li reminded that caution is needed regarding the challenges facing the economy, such as growing uncertainties in the external environment, insufficient domestic demand, and risks and hidden dangers in the real estate market.
Addressing members of the legislature, Li stressed that it is “important to prioritize growth, employment and price stability” this year.
China is targeting around 12 million new urban jobs this year and a survey-based urban unemployment rate of around 5.5 percent, according to the government study report. Annual targets include keeping the consumer price index increase around 3 percent and grain production above 650 million tons. The government work report announced a series of measures to support growth this year. These measures include an estimated 3 percent budget deficit to GDP ratio, an increase of 0.2 percentage points from last year’s level, and the allocation of 3.8 trillion yuan (about $549.8 billion) of special-purpose bonds to local governments.
While also calling for prudent monetary policy to be targeted and strong, the report stressed that the M2 money supply and total financing should generally increase in line with nominal economic growth to support the real economy.
In the report, it was stated that China will prioritize recovery and consumption expansion to expand domestic demand, while the incomes of those living in urban and rural areas will be supported through many channels.
“The Chinese economy will generally improve and the growth rate will most likely reach normal levels,” said economist Yu Miaojie, President of Liaoning University and member of the national legislature.
International institutions and investment banks have raised their forecasts for China’s growth rate this year. The International Monetary Fund (IMF) raised its growth forecast for 2023 from 4.4 percent to 5.2 percent in China last January.
QUALITY IS IMPORTANT
The Chinese government will focus on economic growth, but will not blindly do so. Instead, the country wants a greener and more efficient economy.
Presenting the government work report, Li outlined policy priorities such as accelerating industrial system modernization and promoting the transition to a green development model, underscoring once again efforts to pursue high-quality development policy.
Aiming to reduce its energy consumption per unit of GDP by about 2 percent this year, according to the NDRC report, China will “try to achieve better results in actual work”.
The report outlined the goals of sustaining the reduction in emissions from major sources of pollution, tightening controls on the consumption of fossil fuels, and continually improving the natural environment.
On increasing the country’s technological strength, Li called for pooling quality resources and joint work on breakthrough developments in key technologies in key areas. Li also called for efforts to be made to make traditional industries and small and medium businesses more advanced, smarter and more eco-friendly.
In the face of the serious challenges posed by rising protectionism and spikes in COVID-19 cases over the past few years, China has refrained from relying on investment as a way to boost economic growth and has focused on helping market institutions overcome challenges and grow.
“While we refrained from implementing a lot of strong stimulus policies that would wear down our future growth potential, we took decisive measures to strengthen macro policy support,” Li said.
High-quality development is considered the “most primary and most important task” in China’s modernization efforts. Chinese President Xi Jinping emphasized that instead of taking GDP growth as the sole measure of success, China is now more focused on improving the quality and efficiency of growth.
According to the government study report, within the scope of better quality development, research and development expenditures have increased in the last five years in China, and energy intensity and carbon emissions have decreased.
“Modern China should be a country with high-quality development,” said Han Baojiang, director of the Economics Department of the National Academy of Governance of China and national political adviser.
“Only by giving equal importance to growth and quality, and creating strong synergies for high-quality development, can we build a solid economic foundation for Chinese modernization,” Han said.
One out of every twenty companies in the Netherlands is unable to pay their debts
In the Netherlands, the debt of 5 to 10 thousand businesses, especially in the service sector, is increasing. According to CBS, one in 20 companies is concerned.
The Central Bureau of Statistics (CBS) announced that many businesses will have problems in paying their debts in the coming period. According to the agency, one in every twenty companies has difficulty paying their debts. Especially businesses in the service sector are worried that they will not be able to meet their payment obligations.
During the pandemic period, companies were given a certain period of time to repay their tax debts. However, this period has come to an end and the Tax Office has started to send collection letters to businesses with tax debts from the corona period since the beginning of this month. As of the end of April, the total tax debt that companies still have to pay increased to 16.5 billion euros.
According to a survey by CBS of companies with five or more employees, almost 5 percent of businesses see their debt burden as a major problem. In the service sector, this rate rises to one out of every eight companies.
After the loss of income during the pandemic period, companies are also struggling with increasing costs due to high inflation recently. Most businesses have to pay more for energy, salaries and materials.
In the CBS survey, companies were also asked whether they passed on the rising costs to customers. Three-quarters of the respondents are worried that they cannot reflect all or some of the high costs on the invoice, and that if they do, sales will decrease. Some companies, on the other hand, state that the employment contracts are made on a fixed price, so they cannot increase the label prices.
15% increase in basic food products in the last 6 months in the Netherlands
In the last six months in the Netherlands, some of the basic food products have been increased. The most increased staple food product was sugar, with an 80 percent price increase.
According to the figures announced by the Consumers’ Association today, bread, vegetables and butter, which are basic foodstuffs, have increased by 15 percent since December. The highest increase was made to sugar with 80 percent. During this period, supermarkets increased the prices of approximately 150 products every day.
According to the prices compared by the association; In the six-month period, the most expensive grocery store for basic foodstuffs was the Spar supermarket. The prices of products at Spar increased by 20 percent above the average.
The cheapest market for basic food products is Dirk. Prices in this supermarket were 11 percent below average.
According to the Consumers’ Association, prices started to decline in the six-month period. For example, a pack of Albert Heijn grocery store’s own brand of butter went from 2.65 euros to 3.19 euros last year, but has now fallen back to 2.89 euros.
European Central Bank calls for the abolition of energy subsidies
European Central Bank (ECB) Vice President Luis de Guindos said that European Union (EU) member countries should withdraw their energy supports.
European Central Bank (ECB) Vice President Luis de Guindos said that the European Union (EU) member countries should put an end to the various support programs they have put into practice due to the energy crisis.
Guindos made statements at the European Parliament (EP) Economic and Financial Affairs Committee meeting held in Brussels.
Reminding that the peak inflation in the Euro Zone in October was set at 7 percent in April, Guindos said, “Core inflation remains high, partly due to input cost pressures.”
Guindos explained that the upside risks to inflation are higher-than-expected wage and profit margin increases, as well as exceeding the targets of long-term inflation expectations.
Reminding that the inflation outlook has remained high for a long time, Guindos reminded that the ECB decided to increase the main policy rates again by 25 basis points in its last meeting, and said that policy decisions will be made according to the evaluation of economic and financial data and the main dynamics of inflation.
STRESSED THE IMPORTANCE OF FINANCIAL POLICIES
“An important factor for the future inflation outlook is the fiscal policy stance,” Guindos said.
“As the energy crisis eases, governments should immediately and harmoniously roll back relevant support measures,” Guindos said, emphasizing the importance of fiscal policies aimed at making economies more efficient and gradually reducing high public debt.
EU member states have implemented many measures and support programs against the rising natural gas and electricity prices with the Russia-Ukraine war and energy crisis last year.
The said energy subsidies put a serious burden on the public finances of the member states.
AI impact: Nvidia shares skyrocket
Chip maker Nvidia shares rose 28 percent, thanks to the announced balance sheet well above expectations and the announcement that the supply of chips used in the artificial intelligence industry will be increased.
In previous periods, Nvidia had difficulties in supplying the chips used in the artificial intelligence industry. “Demand was incredibly high in January,” said Jensen Huang, CEO of the company, speaking to Reuters yesterday. We had to place additional orders and provided significantly more supplies for the second half of 2023,” he said, pointing out that his work for the artificial intelligence sector will be increased.
Nvidia also announced its second-quarter earnings yesterday. Revenues came in 50% above Wall Street estimates, Reuters reported.
These two developments caused Nvidia shares to skyrocket.
Nvidia’s shares were trading at $391.50, up 28 percent. The rise in question increased Nvidia’s stock market value by nearly $300 billion, pushing it above $950 billion. Thus, Nvidia became the world’s most valuable chip maker and the fifth most valuable company on Wall Street.
Layoffs spread across all sectors in Europe
In Europe, unusually sticky high inflation, rising interest rates and uncertainty about the economic outlook have forced more and more companies to reduce the number of their employees, while layoffs have accelerated in the continent with the latest decisions announced by telecommunications companies.
The prices of goods and services rose due to disruptions in supply chains in the Kovid-19 outbreak and increased demand after the epidemic.
Increasing interest rates to combat inflation, which became stubborn with the effect of the Russia-Ukraine War, hit the highest level in recent years in Europe. The uncertainty created by the high inflation and high interest rates and the worsening macroeconomic outlook has led more and more companies to accelerate the layoffs to reduce their costs and to reduce their costs. The layoffs, which have spread to almost all sectors since the beginning of this year, especially the technology, manufacturing and automotive sectors, have recently accelerated with the dismissal decisions announced by the UK-based telecommunication companies BT and Vodafone.
Telecom companies reduce employment to reduce expenses Vodafone-based telecommunications company announced last week that it will lay off 11,000 jobs in the next three years to reduce costs and accelerate growth. Vodafone has approximately 104 thousand employees worldwide. It is predicted that Germany, England and Italy, the largest and at the same time the “worst” performance market of the company, will be the countries most affected by the dismissal decision. Vodafone announced in March that it plans to lay off 1,000 people in Italy and approximately 1,300 people in Germany. Vodafone’s decision was again followed by the UK-based telecommunications company BT.
BT, with the increase in digitalization, required less workforce in its operations and reduced costs. It announced that it will part ways with 40,000 to 55,000 employees by 2030. The British telecommunications giant’s total employment will fall from 75,000 to 90,000 by 2030, from its current level of 130,000.
This reduction means the company has cut more than 40 percent of its total workforce.Telekom Italia is reported to be planning to cut 2,000 jobs in Italy through a voluntary early retirement program.Swedish telecom equipment manufacturer Ericsson is working as part of a plan to cut costs. Swiss computer accessories manufacturer Logitech decided to lay off 300 people in March. Finnish telecom equipment manufacturer Nokia announced on May 3 that it will lay off 208 people. Irish-US joint information technology firm Accenture , decided to lay off 19,000 people at the end of March due to concerns about the global economy.
German software company SAP announced that it plans to lay off 3,000 people, who make up 2.5 percent of its global workforce, in order to reduce costs and focus on the cloud business at the end of January. Automotive manufacturer Stellantis, which includes the brands Vauxhall, Peugeot, Citroen, Fiat, DS, Jeep, Alfa Romeo, Maserati, Abarth and Fiat Professional, agreed with the unions in February to lay off 2,000 workers through voluntary layoffs in its Italian operations. group Volvo announced in March that it will restructure its bus manufacturing operation in Europe and cut 1,600 jobs. Earlier this month, Volvo Cars announced its decision to lay off an additional 1,300 people in Sweden. This figure constitutes 6 percent of the workforce in the company’s home country.
Italian automotive parts manufacturer Marelli announced that it agreed with the unions to lay off 400 people at the end of March. British electric vehicle manufacturer Arrival decided to lay off 800 people, which make up half of its employment, in order to reduce its costs. German automotive and industry supplier Schaeffler has announced that it will lay off 1,300 more people by 2026 during the restructuring process.
Retail and consumer products companies are also making waves group Sainsbury’s has announced it will cut 300 jobs immediately following a restructuring plan that will affect nearly 2,000 jobs announced at the end of February. Just Eat, an online food and delivery company headquartered in the UK, announced at the end of March, 1,700 couriers and 170 office workers. German online fashion retailer Zalando said in February that it will cut hundreds of jobs across the company, citing “difficult economic conditions”.
German eyewear retailer Fielmann announced in March that it plans to cut hundreds of jobs by 2025. reported.
British cybersecurity firm Sophos announced in January that it will cut 450 jobs globally. German consumer products company Henkel also cut 2,000 jobs to combat rising costs and low demand. British retail chain Wilko is reportedly planning to lay off 400 jobs. Finnish elevator manufacturer Kone also announced in January that it would cut staff by 1,000, including 150 in its country. Netherlands-based Philips announced plans to lay off 6,000 jobs to offset falling sales after the massive recall of ventilators at the end of January. British Steel, which was sold to China, announced that it would lay off 260 people after announcing the planned closure of coke ovens in the north of England at the end of February. German chemical company BASF, warning that its earnings will decrease further due to rising costs, laid off 2,600 people. German specialty chemicals manufacturer Evonik announced a 200-person layoff plan in April.
Germany’s largest bank Deutsche Bank also announced on April 27 that it will cut 800 jobs in an effort to cut costs by 500m euros over the next few years.Wind turbine manufacturer Siemens Gamesa reported last year that it plans to cut 2,900 jobs by 2025 as part of its plan to return to profitability. 1,900 of this employment reduction is planned to be made in Europe. Spanish pharmaceutical company Grifols has decided to lay off 2,300 employees as part of its strategy revision, which aims to save approximately 400 million euros annually.
British contracting firm Taylor Wimpey was laid off in January to limit costs. Swedish engineering group Alfa Laval has announced a restructuring program that will lay off about 500 employees after rising costs took its toll on its shipping business last year. Swedish garden equipment and tools manufacturer Husqvarna, on the other hand, announced that it will go through a restructuring and cut 1,000 jobs. British homebuilding company Vistry Group is also reported to be laying off 200 employees.
Inflation exceeded 100 percent in Argentina: ‘Now we can only eat meat once a month’
Annual inflation in Argentina rose to 109 percent in April. Millions of people in South America cannot meet their basic needs.
Argentines spoken to by the BBC wonder how bad the situation in the country could get.
For an Argentine named Yanina, living in a place where the cost of living is increasing exponentially is nothing new. He opened his small grocery store in a working-class neighborhood in the capital city of Buenos Aires 10 years ago, when annual inflation was 25 percent.
The inflation rate has increased since then, but Yanina told the BBC people were still able to make a living back then, and even reward those around them. “Only four out of every 10 products people buy could be called a basic need,” she says.
But annual inflation in Argentina has increased exponentially since 2018, and in April it exceeded 100 percent for the first time in 30 years.
Following the currency crisis, a record drought also deeply affected the agricultural sector in Argentina.
Housing prices in the Netherlands continue to fall
Central Bureau of Statistics data showed that housing prices in the Netherlands continued to fall. On an annual basis, there was a decrease of 4.4 percent in April.
According to data from the Central Bureau of Statistics (CBS), housing prices fell by 4.4 percent in April compared to the same period last year. The decline rate in March was 2.3 percent. CBS announced that since August 2022, housing prices have been on a downward trend and the decline in April became more pronounced than in March.
According to CBS data, the average house price in April was 401,000 euros. Compared to prices in June 2013, average house prices are 87 percent higher.
20 percent less homes sold
Considering the number of houses sold, 20 percent less houses were sold in April this year compared to last year. Nearly 13,000 homes changed hands in April.
The number of housing transactions in the first four months of this year decreased by 11 percent compared to the same period last year. More than 53,000 homes changed hands between January and April.
Housing shortage affects the situation
The Dutch Central Bank, in a statement made last month, stated that especially those who will take a new step into the housing market (starter) and those who live alone have difficulty in acquiring a house, and this is due to the problem of housing shortage.
According to the data released by CBS last week; The number of permits issued for new housing construction in the first quarter of this year decreased by more than 25 percent compared to a year ago. In total, construction permits were granted for 12,000 residences. This number was the lowest since the second quarter of 2016.
The Essential Guide to VAT Refund in the Netherlands
Value Added Tax (VAT) is a consumption tax imposed on goods and services in many countries around the world. As an international traveler or business, understanding the process of VAT refund can help you save money on your purchases. This article serves as a comprehensive guide to VAT refund in the Netherlands, providing valuable information and tips to make the most of your shopping experience.
Understanding VAT: VAT, also known as BTW (Belasting over de Toegevoegde Waarde) in Dutch, is applied to most goods and services in the Netherlands. The standard VAT rate is currently 21%, with reduced rates of 9% and 0% for certain goods and services. VAT is usually included in the listed prices of products and services.
Who is eligible for VAT refund? Non-EU residents visiting the Netherlands are generally eligible for a VAT refund on goods they purchase and take out of the country. To qualify for a VAT refund, you must meet the following criteria:
- Be a non-EU resident.
- Purchase goods for personal use.
- Take the goods out of the European Union within three months from the date of purchase.
- Meet the minimum purchase requirement specified by the retailer.
How to claim a VAT refund: To claim a VAT refund, follow these steps:
- Shop at VAT refund-eligible retailers: Look for shops displaying the “Tax-Free Shopping” or “Global Blue” logo. These retailers are authorized to provide VAT refund services. Remember to ask for a VAT refund form (also known as a tax-free form) at the time of purchase.
- Fill out the VAT refund form: Provide your personal details, including name, address, and passport number, on the VAT refund form. Make sure to accurately fill in all the required information to avoid any delays or rejections.
- Get the form validated: Before leaving the Netherlands, you must get the VAT refund form validated by customs. Present your purchases, receipts, and the VAT refund form at the customs desk at the airport, seaport, or designated customs office. The customs officer will examine the goods and provide an official stamp on the form, confirming the export of the goods.
- Collect your refund: After receiving the customs stamp, you can proceed to the VAT refund counter at the airport or use the electronic VAT refund kiosks if available. Present the validated form, along with your passport, to the refund counter. You can choose to receive your refund in cash or have it credited to your credit card.
Important tips and considerations:
- Keep all original receipts: Make sure to retain all your original receipts as they are essential for the VAT refund process. Retailers may refuse to issue a refund without a valid receipt.
- Plan your shopping: Check the minimum purchase requirement for each retailer, as it varies. Consolidate your purchases from the same retailer to meet the threshold and maximize your VAT refund.
- Allow sufficient time at the airport: Arrive at the airport with ample time before your departure to complete the VAT refund process, as it can be time-consuming, especially during peak travel seasons.
- Know the service fees: Some VAT refund service providers charge an administrative fee for processing the refund. Familiarize yourself with these fees to avoid surprises.
Understanding the VAT refund process in the Netherlands can be financially beneficial for international visitors. By following the necessary steps and fulfilling the eligibility criteria, you
Around 11 million people in the UK struggle to pay their bills
In the UK, the number of people who could not make their loan and bill payments on time at least three times in 6 months increased by 1.4 million in January of this year compared to May of the previous year and rose to 5.6 million, while the number of people who had difficulty in paying their bills was 11 million.
It has been reported that around 11 million people in the UK are struggling to pay their bills.
In the statement made by the British supervisory agency, the Financial Management Authority (FCA), it was stated that the number of people struggling to pay their bills in the country reached 10.9 million in January this year, according to the agency’s research.
According to the FCA statement, the number of people who have difficulty paying bills in the country was 7.8 million in May last year.
It is stated in the statement that approximately 28 million of the population in the country lives under intense stress due to their debts, and the number of people who cannot make their loan and bill payments on time at least three times in 6 months increased by 1.4 million in January this year compared to May of last year and reached 5.6 million. was recorded.
In the statement, it was also stated that approximately 6.2 million people in the country had to cancel their insurance policies as of January last year due to the rising cost of living.
THEY ARE LOOKING FOR WAYS TO REDUCE THEIR EXPENSES
“Our research shows the real impact of rising cost of living on the public’s ability to pay their bills,” said Sheldon Mills, FCA Director of Consumer and Competition.
“We will continue to act swiftly to enable financial institutions to assist clients who are facing financial difficulties or are concerned that they may imminent,” Mills said.
In another study conducted by HSBC, one of the leading banks in the country, it was stated that approximately 78 percent of the population was looking for a way to reduce their expenses in some way.
According to the research, approximately 45 percent of the citizens in the country prefer to shop at discount markets and try to reduce their compulsory expenses.
Jose Carvalho, Head of Wealth and Personal Banking at HSBC, said: “The rising cost of living continues to have an impact on many people.”
NUMBER OF RECEIVES FOOD AID REACHED 3 MILLION
Noting that he visited a food bank in the city of Exeter yesterday, Bank of England Governor Andrew Bailey said, “It is clear that many people are faced with difficult decisions and have to cut back on their essential needs.”
According to the annual report of the Trussell Foundation, which operates more than 1,600 food banks and food distribution points across the UK, food parcels have been provided to approximately 3 million people, 760,000 of them for the first time, in the last year.
A RECORD IN HOUSING RENTALS IN LONDON
British online real estate company Rightmove reported last month that the average rent for a home in the capital, London, rose 14 percent in the first quarter of this year to an all-time high of £2,501 a month.
Inflation in the UK was 10.1 percent in March. Food inflation, on the other hand, hit 19.1 percent, the highest level in 46 years.
Last week, the Bank of England (BoE) increased the policy rate for the 12th time in a row from 4.25 percent to 4.50 percent in order to reduce inflation to the 2 percent target level.
Vodafone to lay off 11,000 jobs
Vodafone’s new CEO, Margherita Della Valle, said that Vodafone, which employs approximately 100 thousand people, ‘needs to change’ and made statements regarding the layoffs.
Vodafone’s new CEO, Margherita Della Valle, announced that it will lay off 11,000 jobs in three years.
Valle stated that Vodafone, which employs approximately 100 thousand people, needs to “change”.
‘CASH FLOW WILL DECREASE 1.5 BILLION EURO’
The company predicted that free cash flow will decrease by 1.5 billion euros this year, and that there will be very limited growth in profits in the new financial year.