1 China as the wild card in world economy (Neil Gough in The New York Times) Markets around the world have been jolted by fears that slowing growth and deflationary pressures in Europe, Japan and other major economies could derail the United States. But the health of China, for decades an engine of growth, has emerged as one of the most significant wild cards in the global economy.
It is hard to be certain just exactly how the Chinese economy is faring, given mixed signals in the data. Chinese inflation is at its weakest levels in nearly five years. Commodity prices are plunging. New home sales are declining. Foreign investment is contracting.
The overall economy, though, continues to chug along at a steady, albeit more modest, pace. China’s gross domestic product increased by 7.3 percent in the third quarter, compared with 7.5 percent in the previous quarter.
“The question or problem we are all facing at the moment is, ‘What is right picture for the economy as a whole?’ ” said Louis Kuijs, the chief China economist at the Royal Bank of Scotland in Hong Kong. “It’s complicated by negative forces that show up very strongly in industry but not in the service sector.”
Making sense of China’s economic health is challenging because the slowdown is partly by design. The Communist leadership has pledged to reduce China’s dependence on credit-fueled growth and investment, to instead emphasize domestic consumption. It is a risky proposal, and leaders have signaled a willingness to live with slower growth, provided employment holds up and systemic risks are contained.
“We didn’t have any new recruits this year,” Huang Xinqun, 48, a manager at a large ocean-shipping company, said last week. “Usually when the manufacturing business is not doing so well, it would be directly reflected on us,” he said. “We’re like a signal post on how the economy is doing,” Mr. Huang said. “If companies don’t have that many orders and products to transport, then we don’t have as much work.
2 Apple sells 40m iPhones in three months (Dominic Rushe in The Guardian) Apple sold a record 39.3m iPhones in the last three months, the company has said, helping the tech giant win its highest revenues of the year. Entering the Christmas shopping season, its strongest sales period of the year, Apple predicted its latest iPhones would help boost sales by at least 10% during the crucial holiday quarter.
Overall, the company’s profit rose more than 12% from a year ago, to $8.5bn. Total sales also rose more than 12%, to $42.1bn. The one blemish on Apple’s quarter came from iPad sales, which slipped 13% compared to the same period last year, the third quarter in a row that sales of the tablets have fallen.
“Our fiscal 2014 was one for the record books, including the biggest iPhone launch ever with iPhone 6 and iPhone 6 Plus,” Tim Cook, Apple’s chief executive said. Demand for the new iPhones “has been staggering”, said Cook. “At this point we are selling everything we’ve made.” The company ended the year with $155.2bn in cash and marketable securities. Revenues at Apple’s retail rose 15% to $5.1bn. Apple is planning to open 25 new stores in fiscal year 2015. Most will be outside the US.
The results were ahead of forecasts. Wall Street had predicted that Apple would sell 38m iPhones in the three months to the end of September, a 12% rise on the 34m mobiles sold by in the same period last year.
3 US coalition-building – on Ebola (Khaleej Times) After rallying dozens of nations to join the fight against ISIS militants, President Barack Obama is back in the coalition-building business — this time to fight the Ebola outbreak in West Africa. Obama is working the phones with world leaders, appealing to them via videoconference and publicly jawboning with one clear message: Stopping the deadly virus at its source is the single best way to prevent the outbreak from spreading. And that requires an infusion of additional money and resources to the hard-hit countries of Liberia, Sierra Leone and Guinea.
Obama is sending up to 4,000 troops to West Africa to supply medical, logistical and training support to the region’s overwhelmed healthcare systems. The US military also is building more than a dozen treatment centres in Liberia with hundreds of beds. The president hoped the commitment of US forces would spur other countries to follow its example. But while some countries have and continue to contribute to the effort, Obama says too many others have not, and he has been venting his frustrations with those that he says are holding back even though they have the resources to help.
Obama isn’t the only one spreading the word. The European Union has stepped up efforts to raise more than $1 billion to fight Ebola in West Africa. The president, as he works to calm the fears of nervous Americans at home, says he’s been reaching out “directly to heads of state and government, who, I believe, have the capacities to do more” to fight Ebola abroad.
Obama has discussed the issue by videoconference with the leaders of Britain, France, Germany and Italy, and they agreed to work together on Ebola to “enlist greater support from more countries” and coordinate their ground efforts, the White House said. Obama also reviewed the matter with UN Secretary-General Ban Ki-moon, who said late last week that a trust fund he launched to fight Ebola has just $100,000. The president also had a one-on-one conversation with French President Francois Hollande.