The US job market continues its cooldown, adding just 187,000 positions last month. The U.S. job market has returned to pre-pandemic form. Employers added just 187,000 jobs in July, slightly above the monthly average seen in the decade before the pandemic, according to new data released Friday by the Bureau of Labor Statistics. (CNN)

Global food prices rise after Russia ends grain deal and India restricts rice exports. Global prices for food commodities like rice and vegetable oil have risen for the first time in months after Russia pulled out of a wartime agreement allowing Ukraine to ship grain to the world, and India restricted some of its rice exports, the U.N. Food and Agriculture Organization said Friday. (AP)

How frozen Russian assets could pay to rebuild Ukraine. The U.S. and Europe have a $300 billion problem: What to do with the Russian central bank assets that Western governments froze back in February 2022. (Axios)

Bank of Japan loosens yield curve control, pledging greater flexibility. The Bank of Japan will now offer to purchase 10-year JGBs at 1% through fixed-rate operations, effectively raising its tolerance by 50 basis points. (CNBC)

Bank of England hikes interest rates for 14th consecutive time despite inflation slowdown. Rishi Sunak is on course to meet his inflation target but the UK faces years of higher mortgage rates and a flatlining economy until 2026, the Bank of England warned on Thursday. (The Independent)

Tourists aren't going back to China—and that's another problem for its stuttering economy. China's economic growth has disappointed amid a depressed housing market and high youth unemployment. (Business Insider)

Central banks back away from guidance about what's ahead. The world's most powerful central banks suddenly have one message in common: We're not going to tell you exactly what we're about to do anymore. (Axios)

King signs off the Electronic Trade Documents Bill. The bill, which was first introduced into parliament on 12 October 2022, allows businesses to use electronic trade documents instead of paper documents. (Trade Finance Global)

Australia’s central bank leaves cash rate at 4.1% for 2nd month but says inflation remains too high. Australia’s central bank on Tuesday left its benchmark interest rate on hold at 4.1% for a second consecutive month raising expectations that rates might have reached their peak or are close to plateauing in the current cycle. (AP)

Europe’s economy grows a bit after months of stagnation. But rate hikes are weighing on businesses. Europe’s economy has grown modestly after months of stagnation, but higher interest rates designed to fight inflation are casting a shadow as they make it more expensive for households and businesses to borrow, invest and spend. (AP)

Overstock attracts new suppliers with Bed Bath & Beyond rebrand. The retailer has increased its SKU count by 600,000 since it bought the chain’s intellectual property out of bankruptcy. (Supply Chain Dive)

US credit rating downgraded over rising debt, ‘standards of governance.’ The downgrade marks only the second cut by a major rating agency in U.S. history. (Al Jazeera)

China to drop tariffs on Australian barley amid diplomatic thaw. China’s commerce ministry tariffs ‘no longer necessary,’ while Australia drops trade complaint. (Al Jazeera)

Ocean heat record broken, with grim implications for the planet. The oceans have hit their hottest ever recorded temperature as they soak up warmth from climate change, with dire implications for our planet's health. (BBC)

After the East Palestine train derailment, are railroads any safer? Union officials and railroad workers remain skeptical about the direction the industry is heading and whether their concerns will be heard. (NPR)



Polish Economy Suffers Amid Geopolitical Risk and Inflation

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Jamilex Gotay, editorial associate

Over the last few months, Poland has experienced civil tension due to recent government policy changes. On June 4, 500,000 people marched through the streets of Warsaw, marking the 34th anniversary of elections that led to Poland’s non-violent exit from communism. “But the mass showing was no ritual commemoration; it was both a celebration of the past and a protest against the current Polish government’s effort to return the country to autocracy,” reads an article by The Atlantic.

On June 7, Polish President Andrzej Duda proposed urgent amendments to a law on Russian influence, which he signed the week after it drew U.S. and European Union criticism. “Critics point mainly to the party’s step-by-step takeover of the judiciary and media,” reads an article from the Associated Press. “And fear that Law and Justice could eventually force Poland to leave the 27-member European Union.”

A mixture of new limits on abortion rights and high inflation triggered mass protests across Poland. “Poland’s government blames Russia’s war in Ukraine and the COVID-19 pandemic, but economists say spending policies have accelerated spiraling prices,” the article reads.

The protests as result of government changes weakens checks and balances, said David Kinzel, vice president of structured credit and political risk at Marsh, LLC (Denver, CO) during FCIB’s July Global Expert Briefing. “On top of that, there’s an estimated 1.5 million Ukrainian refugees living in Poland now with several of the 8 million that have come through the country. This has created more changes in Poland's economy.”

Poland’s importation of Ukrainian grain has caused financial difficulties for local farmers and grain companies, sparking more protests. As a result, European Union countries, Poland, Slovakia, Hungary, Romania and Bulgaria will extend their ban on Ukrainian grain imports to protect their farmers’ interests, their agriculture ministers said on June 19. “Food can still move through their land to parts of the world in need after Russia pulled out of a deal safeguarding Black Sea shipments,” reads an article by PBS.

Poland’s proximity to and continued support of Ukraine garners political risk of war given that they are a part of The North Atlantic Treaty Organization (NATO). “When the Russian-Ukraine conflict started, most of the insurers were completely off risk in those countries,” Kinzel said. “As of late, the concern for political risk for Poland has died down and a lot of insurers are more comfortable insuring customers based in Poland but it is still something credit professionals should pay attention to, especially if they have a lot of receivables in Poland.”

Poland’s economic growth is projected to decelerate to 0.7% in 2023, down from 4.9 % last year, according to a report by The World Bank. The report shows Poland's GDP growing by 2.6% in 2024 and 3.2% by 2025. Trading Economics forecasts that GDP in Poland is expected to reach $693 billion by the end of 2023, around $710.32 billion in 2024 and $733.05 billion in 2025.

Increased energy and food prices continue to weigh on household demand in 2023 and will severely impact poorer regions, who devote 50% percent of their monthly spending on food and energy, per The World Bank. “The share of the population at risk of anchored poverty is expected to remain elevated at 1-2% above 2019 levels.”

Customers in Poland have averaged 21.1 days beyond terms, with 73% of credit professionals saying payment delays are staying the same and 27% saying they’re not experiencing payment delays, per the FCIB Credit and Collections Survey. The most common cause for payment delays is billing disputes and cash flow issues (both 50%).

What Credit and Collections Survey respondents are saying:

  • “When you experience a dispute with the client, don’t continue working until you scrub the whole scope of work from the beginning of the contract until the date of dispute. Then agree before project kick off.”
  • “It is important to know customer's payment process to avoid misunderstandings or delays due to administrative issues.”
  • “Do due diligence for all prospect customers, especially to those small-medium privately held companies with no financials or credit reports. Check the profile and validate like business address, company domain e-mail address, etc. and start with small, reasonable credit line and reasonable payment terms.”
  • “Obtain financial statements on your customers and backstop sales with credit insurance.”

The Credit and Collections Survey is now open. It covers France, India, Japan and South Korea. You will earn ICEU/Participation credit for your input. Be sure to share the link with your credit and collections network.



Week in Review Editorial Team:

Annacaroline Caruso, editor in chief

Jamilex Gotay, editorial associate

Kendall Payton, editorial associate