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Europe in panic: Six weeks left before the US rolls out ‘industrial subsidies’

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With only six weeks to avoid a transatlantic trade showdown over green industries, the Germans are frustrated that Washington isn’t offering a peace deal and are increasingly considering a taboo-breaking response: European subsidies. Germany mulls breaking subsidy taboo to avoid trade war with Biden, – writes POLITOCO-PRO.

Europe’s fears hinge on America’s $369 billion package of subsidies and tax breaks to bolster U.S. green businesses, which comes into force on January 1.

The bugbear for the Europeans is that Washington’s scheme will encourage companies to shift investments from Europe and incentivize customers to “Buy American” when it comes to purchasing an electric vehicle — something that infuriates the big EU carmaking nations like France and Germany.

The timing of this protectionist measure could hardly be worse as Germany is in open panic that several of its top companies — partly spurred by energy cost spikes after Russia’s invasion of Ukraine — are shuttering domestic operations to invest elsewhere.

The last thing Berlin needs is even more encouragement for businesses to quit Europe, and the EU wants the U.S. to cut a deal in which its companies can enjoy the American perks.

A truce seems unlikely, however. If this spat now spirals out of control, it will lead to a trade war, something that terrifies the beleaguered Europeans.

While the first step would be a largely symbolic protest at the World Trade Organization (WTO), the clash could easily slide precipitously back toward the tit-for-tat tariff battles of the era of former U.S. President Donald Trump.

International Affairs

Finance

Boosting Equitable Development as Kenya Strives to Become an Upper Middle-Income Country

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The World Bank Group (WBG) Board of Executive Directors today voiced its support for the WBG’s latest six-year strategy to support Kenya in its ongoing efforts towards green, resilient, and inclusive development.

The Kenya Country Partnership Framework (CPF) is a joint strategy between the World Bank, the International Finance Cooperation (IFC), and the Multilateral Investment Guarantee Agency (MIGA) and the government to promote shared prosperity and reduce poverty for the people of Kenya. Informed by extensive stakeholder consultations, the CPF seeks to drive faster and more equitable labor productivity and income growth, greater equity in development outcomes across the country, and help sustain Kenya’s natural capital for greater climate resilience.

The people of Kenya are in a position to reap even greater dividends from the country’s robust economic growth in terms of more durable poverty reduction,” said Keith Hansen, World Bank Country Director for Kenya. “Tackling the drivers of inequality now will help to ensure that Kenya can achieve and maintain more equitable development in the long run.”

Over the past decade, Kenya’s economy has outperformed its Low- and Middle-Income Country (LMIC) peers with the growing number of better-educated and healthier Kenyans in the labor force contributing more than any other factor to rising gross domestic product (GDP). More recently, however, the pace of poverty reduction, and then the COVID-19 pandemic, revealed how vulnerable many households are when faced with shocks. Though Kenya’s economy is rebounding from the pandemic and projected to grow by an average 5.4% during 2022-24, the ongoing drought and global inflation are causing poverty to rise. The CPF finds that Kenya is still well positioned to secure more inclusive growth and the WBG is ready to provide support that targets lagging areas and communities with better services and infrastructure that build household and community resilience. In doing so, it aims to help Kenya avoid the inequality and productivity traps experienced by other Middle-Income Countries (MICs).

“Kenya’s private sector is poised to drive faster job creation and to seize new opportunities from global and regional integration,” noted Jumoke Jagun-Dokunmu, IFC Regional Director for Kenya.This will require a more level playing field for competition and innovation for large and small firms and between public and private enterprises.”

The CPF also aims to help raise the productivity of small firms, small producers, and women entrepreneurs, improve the investment climate across the country, and stimulate more private participation in public service delivery. To support Kenya’s response to climate change, the CPF has programmed investments to reduce water insecurity, and to mobilize more climate finance for both public and private investments.  

MIGA aims to unlock more private sector investment in climate responsive projects in Kenya through innovative financial solutions,” said Merli Baroudi, MIGA Director for Economics and Sustainability. “Kenya’s impressive progress in mobilizing private capital for renewable energy augurs well for other sectors.

The CPF draws on Kenya’s Vision 2030, the new government’s development agenda, a Systematic Country Diagnostic, a Country Private Sector Diagnostic, a Completion and Learning Review of the previous Country Partnership Strategy, and over 34 stakeholder consultations, including with Kenya’s diaspora. The World Bank Group is Kenya’s largest development financier. IFC’s portfolio of private sector investments in Kenya is its fourth largest and fastest growing in Sub-Saharan Africa and MIGA’s financial operations in Kenya are its third largest program in Africa.

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Tehran hosts Iran-Belarus business forum

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Iran’s capital Tehran hosted an Iran-Belarus business forum at Saadabad Palace Complex on Tuesday evening, the portal of Iran Chamber of Commerce, Industries, Mines and Agriculture (ICCIMA) reported.

The forum was attended by senior officials from the two sides including First Vice President of the Islamic Republic of Iran Mohammad Mokhber and Prime Minister of the Republic of Belarus Roman Golovchenko.

Organized by ICCIMA jointly with the Belarusian Chamber of Commerce and Industry (BelCCI), the business forum was also attended by Iranian Minister of Industry, Mining and Trade Reza Fatemi-Amin, Chairman of the BelCCI Mikhael Miatlikov, and ICCIMA Head Gholam-Hossein Shafeie, as well as heads and representatives of more than 120 Belarusian and Iranian companies.

Forming working groups to remove trade barriers

Speaking at the forum, ICCIMA Head Gholam-Hossein Shafeie called for the formation of joint special working groups in order to identify existing challenges and problems in the way of the trade between the two countries and also to assess the feasibility of joint commercial projects.

According to Shafeie, empowering the two countries’ small and medium-sized enterprises (SMEs), strengthening banking and insurance cooperation, defining new joint projects, developing and facilitating the issuance of visas for businessmen and tourists, creating the necessary infrastructure for developing economic relations, especially in the commercial, industrial and technical sectors are among the measures that the governments of the two countries can take for boosting mutual trade.

The official also underlined the establishment of a joint trade committee between the chambers of Iran and Belarus as an effective measure for developing trade ties.

Iran to open $100m credit line for Belarusian traders

Further in the forum, Iranian Industry, Mining, and Trade Minister Reza Fatemi-Amin described Belarus as an important country from an industrial point of view and considered the economies of Iran and Belarus to be complementary to each other.

Pointing out that several business delegations have been exchanged between the two countries over the last four months, Fatemi-Amin said: “Fortunately, good agreements have been made so far to improve the financial channels between Iran and Belarus, and we are witnessing improvement in the logistics sector as well.”

At the end of his speech, Fatemi-Amin announced the opening of a $100-million credit line for Belarusian traders who are interested in buying Iranian products.

Iran, Belarus should provide trade, investment infrastructure

Elsewhere in the event, Prime Minister of Belarus Roman Golovchenko said there are numerous fields for cooperation between Iran and Belarus, and considered it necessary to reach an agreement to strengthen cooperation between the two countries.

Golovchenko further emphasized that the governments of the two countries should provide an appropriate environment for businessmen to operate.

Tehran Times

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6 Predictions for Businesses in 2023

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In an ever-evolving business landscape, it’s important for business owners to stay ahead of their competition. By keeping up with trends and anticipating customer needs for 2023, businesses can stay one step ahead. But what do you need to do to stay up to date? How can you predict what’s going to be important? Let’s take a look at some of the things that you should be anticipating as this year comes to a close.

Changes in the Workforce

With the economy at a turning point, the number of remote workers will continue to rise, just like it has this year. With advancements in technology and more flexibility from employers, more will be able to work from home or other remote locations. This means that office space will become less important, and companies will save money on overhead costs. If you are not set up for offering your employees the option to work remotely, now is the time to start investing in the software and technology that will make that possible.

Another change that’s coming is the increase in contract workers. As companies look to save money, they will increasingly use contract workers instead of full-time employees. There are some roles that will have to remain in-house but think about your own business and some of the tasks that you could outsource. Will contracting out this work save you a substantial amount of money? Will it make things easier for you? If so, it’s time to start putting the framework in place to make this happen. Finally, there will be a greater focus on employee wellness. Many employers are investing in employee wellness programs and putting a bigger focus on their needs. This comes with benefits including reduced absenteeism, increased productivity, and improved morale.

Technology

There is no doubt that technology plays a significant role in businesses today. From automating tasks, to communicating with customers and employees, technology has transformed the way businesses operate. As we move into the future, businesses will continue to rely on technology to stay competitive. 2023 is expected to be a big year of growth with robotics and artificial intelligence becoming more prevalent. 4G internet will be largely replaced with 5G networks to provide faster speeds and better connectivity. Cloud computing will become even better, allowing businesses to store and access huge amounts of data from anywhere in the world. Virtual reality and augmented reality will be used for training, marketing, and product development. Finally, blockchain will be more prevalent in helping businesses keep track of transactions and data securely.

Safety

As the world begins to recover from the pandemic, businesses are going to have to start thinking about safety in the workplace even more than before. With so many people out of work and looking for any opportunity they can get, businesses are going to be prime targets for lawsuits if something goes wrong. There are a few things that you can do to help make sure that you’re as safe as possible in 2023. First, you need to make sure that your employees are properly trained in safety procedures. Second, you need to have a plan in place for what to do if something does go wrong. Finally, you need to make sure that you have the necessary systems and equipment in place to improve safety standards. If part of your business model includes the management of a fleet of vehicles, you should have GPS tracking and specialized software that will help to improve driver safety whilst also ensuring all vehicles are kept in top condition. Once it’s installed, be sure to regularly check for any potential hazards or faults.

Global Competition

Even though inflation is at an all time high, with the markets continuing to open up, there is going to be increased global competition for businesses in 2023. To get ahead, you will need to be more innovative and efficient to compete in the global market. Start by building strong relationships with your customers and potential markets. Let them know your brand is one they can trust and rely on. Speak to their pain points and don’t put profit over their needs.  Additionally, to make sure you stay competitive, you will need to invest in your employees and provide them with the skills and training they need to be successful. Show your employees that you care about their happiness in the workplace and that your company is the one they want to work for. So how do you achieve this? It’s not going to be done overnight but you can start by reevaluating every element of your strategies and processes. What can you change to make your business more competitive?

New Business Models

The sharing economy is one business model that is on the rise. This model allows people to share resources and services instead of owning them. Companies such as Airbnb and Uber are examples of the sharing economy. Another business model that is gaining popularity is the subscription model. This model allows customers to pay a recurring fee for access to a product or service. Netflix and Spotify are two companies that use this model. The freemium model is also becoming more popular. This model offers a basic version of a product or service for free, but charges for premium features. Many companies, such as Evernote and Dropbox, use this business model. Is there a way your business can utilize one of these business models to expand in 2023?

Data Protection

As the world increasingly moves online, data protection is going to become even more important for businesses in 2023. With more and more sensitive information being stored electronically, the risk of data breaches and cyber-attacks is increasing. Businesses need to be prepared to protect their data from these threats. What steps can you take to protect your data? First, you should invest in robust security systems. Second, you should create backup systems so that if your primary system is breached, you still have access to your data. Finally, you should educate your employees on the best practices for data security. By taking these steps, you are adding a layer of protection from the growing threat of cyber-attacks and data breaches.

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