India Builds First Smart City With Population Rise

smart-cityWith India’s population rising drastically, it is tough to accommodate such a large population, the Indian government is now creating its first man made Smart city which can help stabilize the Urban population.

With the urban population in India expected to rise upwards of 400 million people, up to 820 million in population by 2050. This rise in population is the reason why they are building this man made city on the Sabarmati river in Gujarat. After the first estimates, the cost of this city will reach upwards of $1 trillion US dollars according to KPMG. Reuters explained, “The plan is also crucial to Modi’s ambition of attracting investment while providing jobs for the million or more Indians who join the workforce every month.” Not only would they develop more housing and available real estate, the mini city which would be self sustaining city which would end up creating so many job opportunities.

With the US dollar to rupee ratio changing so drastically, currently at a 62:1 ratio (usually around 50:1), the cost for this is fairly lowered due to the price per dollar is so low. Prime Minister Narendra Modi spoke after his latest election about how he expects to have nearly 100 smart cities across India by the city 2022. Jumping ahead and creating these cities before the expected increase in popular is a great way the government will save money and also begin to boost the economy forward in a direction which is much needed.

For more financial news and updates, please visit Araceli Roiz‘s official website.

Greek Financial Issues

Greek_EconomyIn early April, Greek Finance Minister, Yanis Varoufakis smoothed over some confidence inquiries into the country’s ability to pay off its debt. Many have been fearing default as the deadline for a large loan payment nears, which the government owed to International Monetary Fund. Citing that Greece plans to “meet all obligations to its creditors” Varoufakis aimed to give a boost to the peace of mind that many lenders have lost over the years.

Plans for the Greek Finance Department to reform their common practices and repair relationships with their lenders are already underway. This year to date, Greece has been borrowing from state entities and has not accepted bailout funding this August 2014. Due this Thursday, a 450 million euro loan is coming to maturity and due to the IMF, the source of some skepticism regarding Greek economic strength.

All indications are pointing to Greece making its payment by the due date. After a meeting between Varoufakis and the IMF Managing Director, Christine Lagarde cited that their conversation went well and all was on schedule.

Currently a number of banks who led the bailout effort have frozen their funds to support the country until their government rolls out a new financial reform package that meets the standard of the lenders. To ensure that money will not be lost, lenders turned down the initial proposal from the Greeks.

The funding freeze puts pressure on the country to find monetary ways of keeping their heads above water while reforms are drafted and reviewed. The government has assured that no pension or wage cuts will be present across the economic struggle and not at risk. Approval of reforms will lead to the freedom of 7.2 billion euros from its bailout agreement as well as 1.9 billion made in profits through Greek bonds from the European Central Bank.

For more financial updates and news please visit, Araceli Roiz‘s official website.

International Oil Surplus Spurs Business

oil-surplusWorldwide oil production will not scale back output, as the price of oil continues to drop. OPEC, announced late last year that their production would continue on their current pace, coupling that with the current emergence of shale-oil in the Permian basin, and we have an oil surplus. With the price-per-barrel lingering around $50 of late, look for an uptick in mergers and acquisitions in the oil industry around the world.

Industry experts deduce their predictions from analysis and discussions with market decision makers and those in charge of major players in the oil world. Current cost and cash-flow pressures on companies, had led to evaluation of strategic movement into dealmaking. Late last year, announcements had begun with the Halliburton-Baker Hughes merger. This deal is set to be complete this coming summer. Also last year, a deal was made for   a Nigerian oil block and pipeline by Royal Dutch Shell to an association led by Taleveras group. Predictions are stating that in the next 6-12 months we may see the most M&A activity in sector.

Firms that are currently weathering the surplus storm, will look to take advantage of their continued cash-flow and leverage their position to acquire companies which seek a lifeboat. Firms that operate internationally will be on the prowl to enhance their portfolios while more local, national firms may be road blocked by their home-country’s agenda.

Keep in mind that with the state of the market sector, those who are in good financial standing have less cash on hand than usual. Any offer or strategic movement will be heavily thought over and carefully planned out. With decreased cash companies will not be letting a penny go to waste.

In all, analysts are stating that deal activity will benefit international and national oil health. This is an industry that has seen slow M&A activity compared to other sectors. New deals may spark a healthier market.
For more please visit GulfBusiness article and also visit: Araceli Roiz

 

Global Debt Rising

With every passing year, the World’s debt is slowly climbing. This increase in debt can be compared to a bubble waiting to burst. Although as a whole, debt is falling (in some countries), the amount of debt around the world is still historically high. The reason for the historically high amounts of debt is based on the glowing growth of the economy tied in with inflation falling, which causes interest and debt payments to rise. This so called ‘poison‘ combination causes households to simply not pay off debt collected.global debt outstanding chart BBC reports, “There has also been a fall in inflation rates in many countries. Inflation can help limit debt burdens. Household incomes, company revenues and government tax receipts all rise but debt payments are often fixed. Low inflation, especially if it is lower than borrowers expected when they took their loan, weakens that process and leaves debt burdens heavier than they would have been.”

A major factor in this crisis is that Asian countries, in particular China, which is one of the largest players in the world’s economy has an extraordinary high peak in debt in the recent years. “In the case of China, the report describes the rise in debt as “stellar”. Excluding financial companies it has increased by 72 percentage points to a level far higher than any other emerging economy.” According to a BBC article, Turkey, Thailand, and Argentina have marked high increases in debt.

As for the US and UK, have been doing their part in terms of lowering the debt. Even though the government debt has been rising in both countries, which will most likely continue to rise, the household debt problem in these countries have dropped significantly.UK, US debt breakdown chart This can be accredited to a stable economy which leads to households paying back loans at a lower interest rate. Even though the World debt is getting to a point which is unsafe, Mark Carey of the US Federal Reserve believes the US is doing OK, “he would have toned down a little the size of the disaster we are facing, and that the situation is not as bad as described. He said there is no obvious downtrend in economic growth and pointed out that a great deal of American debt has a variable interest rate. That would reduce the debt burden as inflation falls.”

We can only hope that trends begin to change because once that bubble bursts the world’s economic state could go haywire. For more on this issue, please visit BBC‘s article on the World Debt Issue.