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Global Talent Update -- July 2018

Europe, Middle East and Africa

Switzerland's economy has been notably uneven during the first half of 2018. However, according to the Financial Times, things could be returning to a level of relative stability during this year's midpoint. Gains in domestic consumption and exports fueled an uptick in Switzerland's KOF Economic Barometer, even as Swiss stalwarts like pharmaceuticals didn't perform as strongly as usual.

Switzerland also took the No. 1 spot on the Global Innovation Index's list of the world's most innovative economies for 2018 - ahead of several nearby nations, like Sweden, the Netherlands and the U.K. The GII cited the country's strong manufacturing sector, thorough patent laws and higher education opportunities as evidence of its qualities.

Mere decades ago, the Republic of Ireland was beset by sectarian violence and terrorist acts that caught the whole world's attention. Yet 20 years later, those horrors are far in the Emerald Isle's rearview mirror, with a stable society and an imperfect but steadily accelerating economy.

In fact, the European Commission recently projected Ireland to see greater growth in its gross domestic product - 5.6 per cent year-on-year - by 2018's end than any other country in the EU. While this would be a slowdown from the breakneck pace of 7.7 per cent seen in 2017, it's far ahead of the EU pack, with only Poland, Hungary, Slovenia and Romania coming anywhere near Ireland. Domestic demand is expected to primarily drive this surge in Irish growth.


Ever since developing into an electronics manufacturing powerhouse, Japan established itself as Asia's most powerful economy. The furious growth pace China experienced in the last decade cast Japan's top-of-the-ladder status somewhat into question, however, and unique difficulties faced by the nation - such as currency deflation and an aging population reducing the size of the labour force - have not yet been fully addressed by the government under Prime Minister Shinzo Abe, according to Bloomberg.

Additionally, The Japan News reported that recent government data uncovered a 0.6 per cent annualized-rate contraction in the economy's GDP during the first quarter of 2018. Although Finance Minister Taro Aso underplayed the significance of the quarterly downturn and said it would correct itself via growth in capital expenditures, the issue nonetheless remains a significant one for the country going forward. The continuing trade wars between the U.S., EU and China, among other nations, could also have a notable adverse effect on Japan's economy.

By any measurement, 2018 has been a year of considerable success for the economy of Thailand. The nation has shown a demonstrable commitment to surging forward with efforts to bolster its infrastructure and its technological acumen, while also remaining focused on stalwart industries such as tourism.

According to Cryptoslate, Bank of Thailand Governor Dr. Veerathai Santiprabhob also announced that the nation's government will turn to emerging technologies like blockchain in the effort to modernize its financial and social standing in the world.

There is some concern that the trade wars that have started brewing among major powers of the world including China, the U.S., Japan, Germany, Mexico and many other countries will spread to developing countries like Thailand and lead to global economic difficulties. However, The Nation reported that Thailand's GDP growth is projected to continue at a positive pace throughout the remainder of 2018, due to the expectation of continued success with various infrastructure projects and domestic consumption. All told, the trade conflicts' impact to the Thai GDP should be reductions of no more than 0.3 per cent of total GDP and 1.2 per cent of exports, making for an solid overall outlook.


The size of the American labor force swelled dramatically in June 2018. According to the latest Employment Situation Summary issued by the Bureau of Labor Statistics, nonfarm payroll organizations across all American industries added 213,000 jobs during this month. This was slightly less than May's tally of 223,000 new positions but a strong number nonetheless by any objective standard. It also beat the median figure of 195,000 projected by several economic experts who had been surveyed by Bloomberg.

Not everything in the BLS report was positive. Wage growth slowed down by 0.2 per cent, and the unemployment rate rose from May to June - coming in at 4 per cent after May's remarkably low figure of 3.8 per cent. However, many seem to believe that this was a side effect of growth in the labor force participation rate, which had just jumped 0.2 per cent to reach an annual high of 62.9 per cent. This often indicates an uptick in jobless individuals beginning to actively seek work again.

Sorted by sector, professional and business services, manufacturing and healthcare created the largest shares of jobs: 50,000, 36,000 and 26,000 new positions, respectively. Retail trade was the only field to see a noteworthy loss of workers during June, as it shed 22,000 positions.

With retail sales also increasing - rising 0.5 per cent, according to the Census Bureau - it's clear the American economy is currently well-positioned. That said, the International Monetary Fund noted in a July 16 statement that trade tensions between the U.S. and other countries could cause growth to slow down in the near future if left unchecked.

For decades, the economy of South America has been decidedly unpredictable, with some nations fiscally stable and others on a seesaw bouncing back and forth between good and bad. As two of the continent's largest nations (and biggest economies), examining the current state of national finances in Argentina and Brazil offers a glimpse of how two nations can exist in such vastly different spaces, despite being fairly similar on the surface in a number of ways.

Argentina is driving its economy forward through a multi-tiered plan devised in part by the IMF, according to an official release from the worldwide economic organization. Key objects of the initiative include a reduction in inflation, steep cuts to Argentina's overall fiscal debt, maintenance of a flexible exchange rate and the reinvigoration of the country's national bank as an independent body. The IMF has afforded Argentina a Stand-By Arrangement loan of $50 billion to aid in these efforts, many of which involve adding funding to Argentina's various social programs. Roberto Cardarelli, the IMF's Argentina Mission Chief, elaborated on the plans' goals:

"Argentina's economic plan aims to restore financial markets' confidence and progressively lessen the strains on the country's ability to pay its bills," Cardarelli stated. "To do so, the government has committed to an economic program that reduces borrowing, puts public debt on a firm downward path, and strengthens the credibility of the central bank's inflation targeting framework. At the same time, the plan intends to protect society's most vulnerable from the inevitable negative effects that cuts in ... spending will have on the economy. Ultimately, the objective ... is to pave the way for stronger, more sustainable and equitable growth that can benefit all Argentineans."

Brazil, by contrast, isn't progressing quite as well with its own efforts at economic recovery. In May 2018, the country's central bank saw its measurement of economic activity drop by 3.34 per cent, representing the biggest decline seen for that metric since 2003. Setbacks like this amid a backdrop of considerable civil unrest - stemming from the numerous government and corporate corruption scandals Brazil has endured in just the last few years - offer what many would consider a dark outlook for the nation's immediate future.

However, the next two months saw some reversal of the discomfiting trends noted in May. According to a quorum of economists gathered by Reuters, Brazil's rate of inflation in July will likely exceed the midpoint of the central bank's targeted percentage in this metric, with consumer prices projected to have reached 4.64 per cent.

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