India Becomes 6th Largest Economy and Beat France



The World Bank issued the updated economic figures for previous year which showed that India held the sixth rank for the world’s largest economy and pushed France lower into the seventh spot. The gross domestic product (GDP) of India reached $2.597 trillion at the end of 2017 while France’s GDP amounted to  $2.582 trillion.

The Indian economy had a strong rebound since July last year following the declines in the past quarters due to economic policies imposed by the Prime Minister Narendra Modi's administration. There are about 1.34 billion Indian citizens which would likely make India the world’s highest population against 67 million French inhabitants. This explains that India’s per capita GDP remains a portion of France which is approximately 20 times higher according to the World Bank.

The consumer and manufacturing expenditure served as the main drivers for India’s economy in 2017 after Modi’s demonetization program of large banknotes way back in 2016 as well as the unorganized new tax system of the country.

India was able to double its GDP in a span of a decade and anticipated to power ahead as Asia’s economic engine as China wind down. The International Monetary Fund stated that India is predicted to grow by 7.4 percent in the current year and 7.8 percent in 2019, supported by tax reform and household spending. This was compared to the world’s forecast average expansion of 3.9 percent.

The Centre for Economics and Business Research mentioned that India would likely beat the GDP of France and the United Kingdom at the end of 2017. The London-based consultancy further told that there is a modest chance for the Indian economy hit the third place for the world’s largest economy by 2032.

Last year, Britain was regarded to be the fifth biggest economy in the world with a GDP worth $2.622 trillion. Meanwhile, the United States hailed as the number one economy followed by China, Japan, and Germany.

Irish Economy to Reach Highest Growth in 2018



The economy of Ireland is projected to reach its highest record in 2018 based on the latest outlook of the European Commission. Ireland’s gross domestic product (GDP) is projected to expand by 5.6 percent this year and 4 percent in 2018, supported mainly by domestic demand.

Meanwhile, the estimate of the EU executive shows that eurozone GDP has the potential to increase by 2.1 percent, which is below the 2.3 percent forecast according to its May report. 

Since Ireland is a very open economy, the country is potential to have revisions in the international taxation and trade environment. While the activities of multinational corporations could affect the headline GDP growth. In the near term, the commission expects that the domestic economic activity could possibly grow at a strong momentum.

In general, the commission reduced its predictions for the EU economic growth for this year because of trade adjustments due to increasing oil prices and tensions with the United States which drove the EU inflation higher.
There is an optimistic outlook for the whole year despite better trade with the United States. Forecasts were mostly taken prior to the United States raising their stakes through 10 percent tariffs on an extra $200 billion worth of Chinese imports, announced on Tuesday. 

The worsening trade war has added uncertainty on the outlook that also affected the Chinese financial markets in the past few weeks. 

With sluggish credit expansion and domestic demand ranging from government-funded infrastructure investment to consumer spending, China’s economy seems to be showing signs of struggle and weakening. 

The huge export sector may add impact on tariffs with the U.S. giving 25 percent tariffs on $34 billion of Chinese imports on Friday, which then triggered Beijing for rapid retaliatory measures on the same amount of U.S. Chinese exports to China. 

Moreover, the uncertainty caused by trade war pushed the corporate borrowing costs higher in reaction to soften the economic effect of a multi-year easing on riskier lending. More cash were accumulated through lesser reserve requirements for lenders three times this year.

Drop in Inflation Rate of Malaysia



The Annual inflation rate of Malaysia declined to 1.3 percent in June from 1.8 percent the month earlier due to the withdrawal of a goods and services tax based on the poll by Reuters. 

A survey of ten analysts by Reuters forecast for June ranged from 0.6 percent to 1.9 percent. The central bank of Malaysia kept the interest rates at 3.25 percent at a policy meeting on July 11 despite sluggish inflation and steady growth. 

The new government by Prime Minister Mahathir Mohamad starting May 9 general election abolished the consumption tax of 6 percent on June 1, which was implemented for three years. 

According to economists, the elimination of goods and services tax affect the inflation and pushed it lower in June,  despite the higher cost of transportation and food during the month of fasting in Ramadan and subsequent Eid al-Fitr celebrations.

South Korea to Unite with Asean and India



The 1950-53 Korean War ended under the Presidency of South Korean leader Moon Jae-in and successfully settled regional programs for economic, political, security, social and cultural. While the previous presidents including  Kim Dae-Jung, Roh Moo-hyun, Lee Myung-bak and Park Geun-Hye attempted to fix similar issues but failed to do so. 

Whenever the country’s leaders turned their attention to Southeast and South Asia, problems will always come up within the Northeast especially in the Korean Peninsula, which causes immediate distraction and inconsistency.

However, President Moon tried a new method instead of using the same strategy, he positioned South Korea within the ongoing alliance with the Indo-Pacific region. Mr. Moon travels within and outside the country and promised to take a visit on Asean nations on the first two years of his leadership.