China slowdown means it may never overtake US economy, forecast shows. China is no longer set to eclipse the U.S. as the world’s biggest economy soon, and it may never consistently pull ahead to claim the top spot as the nation’s confidence slump becomes more entrenched. (Bloomberg)
BRICS welcomes new members in push to reshuffle world order. The BRICS bloc of developing nations agreed on Thursday to admit Saudi Arabia, Iran, Ethiopia, Egypt, Argentina and the United Arab Emirates in a move aimed at accelerating its push to reshuffle a world order it sees as outdated. (Reuters)
Western officials plan to warn UAE over trade with Russia. U.S., U.K. and EU sanction envoys will jointly press the kingdom this week to halt shipments of goods that could help Moscow in its war against Ukraine. (Mint)
Xi’s expected G20 no-show may be part of a plan to reshape global governance. When the world’s most powerful leaders descend on New Delhi this weekend to address the multiple crises facing the world, notably absent will be China’s Xi Jinping, who has never missed a G20 summit since taking power in 2012. (CNN)
China's largest banks extend billions to Russia as Western lenders exit. China's largest banks are increasing their exposure to Russia's banking sector, with loans totaling nearly $10 billion, as Western lenders exit the country due to sanctions. (Mint)
World faces a shallow trade recession from China to Germany. The global economy faces what at least one forecaster is calling a mild trade recession as shipments from China slump and German factories downshift. (Bloomberg)
Why Japan might seek to hold China to WTO rules. Japanese policymakers must be considering all this after China last month imposed an import ban on all Japanese seafood. (Bloomberg)
Apple shares slide after China government iPhone ban reports. Shares in Apple have fallen for a second day in a row after reports that Chinese government workers have been banned from using iPhones. (BBC)
India’s manufacturers cash in as brands seek refuge from US-China tensions. Indian firms are capitalizing on a push by leading brands to diversify their suppliers away from China. ( Al Jazeera)
Bank of Canada says interest rates may not be high enough. Bank of Canada Governor Tiff Macklem on Thursday said interest rates may not be high enough to bring inflation back down to target, sending a hawkish message after holding borrowing costs at a 22-year high a day earlier. (Reuters)
Philippines’ Marcos orders price cap for rice amid ‘alarming’ price surge. Presidential office announces price ceiling for staple, citing ‘considerable economic strain on Filipinos’. (Al Jazeera)
Canada rate policy might be ‘sufficiently restrictive,’ Gov. Tiff Macklem says. The rapid rise in interest rates is constraining activity, but inflation still too high, central banker says. (WSJ)
Israel says it will reopen the main cargo crossing to Gaza on Sunday, a relief for Gazan producers. Israel will reopen the main commercial crossing to Gaza after Israeli authorities closed it earlier this week, saying they had found explosives headed out of the embattled territory. (AP)
Gas prices jump as strikes in Australia begin. Natural gas prices have jumped after strike action kicked off at two major liquefied natural gas (LNG) facilities in Australia. (BBC)
Japan Economy Grows Slower than Expected
Kendall Payton, editorial associate
Asia-Pacific markets were lower on Friday as Japan revised down its second quarter gross domestic product figures. Japan’s economy grew 4.8% in the second quarter on a quarter-on-quarter annualized basis, a smaller growth than the 6% seen in the preliminary estimates and lower than the 5.5% expected in a Reuters poll.
This news comes as tensions between Japan and China mount. Japan began to release treated water tainted from the Fukushima No. 1 nuclear power plant last week. But neighboring countries such as China and South Korea are not willing eat seafood imported from Japan.
China’s import ban, which affects $505 million worth of Japanese imports, emerged right after Japan’s decision to discharge the treated radioactive wastewater. Japanese Foreign Minister Yoshimasa Hayashi said the country will take any necessary action at the WTO or other frameworks over China’s move. Though Japan claims treated water is safe for human consumption, China remains adamant in its opposition.
By releasing the treated wastewater in small increments, Tokyo Electric Power Company (TEPCO), who oversees the process, hopes to dilute the water as much as possible. A recent TBS poll showed 59% of the Japanese public was in support of the release plan, while 49% said the government was not doing enough in effort to prevent reputational damage, per The Japan Times. "The ocean is the common property of all humanity,” said the Chinese Foreign Ministry in a statement. “Forcibly starting the discharge of Fukushima’s nuclear wastewater into the ocean is an extremely selfish and irresponsible act that ignores international public interests."
In retaliation, public unrest in China has sparked with calls for boycotts of Japanese products on social media, nuisance calls to officials and impromptu protests. And the spread of misinformation with sensationalized headlines have caused deeper tension towards Japan. Videos of sea animals washing up dead on beach shores, for example have spread on social media in order to further push the agenda of resistance to eat seafood from Japan’s waters. A study by a UK-based data analysis firm called Logically found high volumes of state media reports and paid advertisements in about the risks posed by the wastewater, according to The Guardian. “China’s coordinated campaign amplifies climate change misinformation and health misinformation around wastewater release,” Logically reported.
Despite all pushback, Japan continues to go great lengths to show confidence in their waters being safe—even going as far as Japanese Prime Minister Fumio Kishida eating Fukushima fish sashimi during a lunch meeting. Kishida said he will soon announce measures to help recover Fukushima’s fishing industry. In support of Japan, South Korea’s President, Yoon Suk Yeol also ate seafood for lunch with his staff to show that it was safe. “We will do everything in our power to bridge the gap between safety and peace of mind,” said Minister Yasutoshi Nishimura.
Customers in Japan have averaged six days beyond terms, with only 18% of credit professionals saying payment delays have increased and 46% saying they have not experienced payment delays at all, per the FCIB Credit and Collections Survey. The most common cause for payment delays is customer payment policy (100%).
What Credit and Collections Survey respondents are saying:
- “The 5 C’s of Credit are crucial. Know your true legal customer, not their trade or dba name and make sure your credit application is fully executed.”
- “Start early building a relationship with your customer and include your salesperson.”
- “It is important to know a customer’s payment process to avoid misunderstandings or delays from 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.”
The Credit and Collections Survey is now open. It covers Egypt, Germany, Italy and Venezuela. You will earn ICEU/Participation credit for your input. Be sure to share the link with your credit and collections network.
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