Economy

On July 1, 2024, Greece introduced a six-day workweek to reduce labour shortages and eradicate unpaid overtime. This law applies to industrial facilities and 24/7 services but it excludes tourism and food services.

While Greece sees this as a positive step, employee relations experts around Europe argue that the long working hours and inadequate rest will affect work-life balance and productivity. This decision is also quite a surprise because other European countries want to implement shorter workweeks.

The article discusses how the production of AI chips could have significant geopolitical implications. These chips, which serve as the backbone of AI technology, are primarily manufactured in a few key countries like the United States and China. However, as AI becomes increasingly integral to various industries, other nations may seek to establish their own chip-making capabilities.

The Bank of Japan (BOJ) raised its main interest rate from -0.1% to between 0% and 0.1%. In 2016, the BOJ made the rate less than zero to help Japan’s economy.

The decision to raise rates depended on big companies increasing their workers’ wages to deal with the higher cost of living. Recently, Japan’s biggest companies agreed to increase wages by 5.28%, the largest increase in over 30 years. Wages had not increased since the late 1990s as prices rose very slowly or even fell.

Big companies in Japan are giving their workers the pay raises they asked for. Some companies are even giving more than what was asked. 

Suzuki, Toyota, and Honda, among others, agreed to give raises. Those in the retail and food service are also increasing wages. However, it's still not clear if small and midsize companies will follow suit.

Because wages were low, people were saving more and spending less. Now that many will be receiving a pay raise, it's expected that people will start spending more.

Money is a tool we use to achieve a goal. Different people have different strategies for what to do with money.

Some spend everything on consumer goods or recreational activities, such as enjoying a meal in a restaurant or going to a cinema. Others are in a situation where they can’t save money at all. They have to live from paycheck to paycheck. Such people are said to be living hand-to-mouth.

Most organizations, such as the widely recognized Henley Passport Index, believe the strongest passports are the ones that allow their citizens to enter more countries without a visa. They rank Singapore as the most powerful passport in 2023 because it provides easy access to 194 countries.

In the US, the labor market is slowing down. Around 250,000 workers found new jobs and the unemployment rate fell to 3.4%, last April.

Watch this short video: What is the circular economy?, about using a circular economy.

The video is about 4 minutes long with subtitles. You can change the speed of the video using the "playback speed" button in the tool bar at the bottom. Then discuss it with your teacher using the questions listed below. 

The standard measure of economic performance, the gross domestic product (GDP), measures the value of goods and services produced within a country over a given period. However, the GDP doesn’t measure social factors like income inequality, domestic violence, drug addiction, or the impact of today’s actions on future generations. It also ignores sustainability and environmental destruction. It’s a very short-term view of market factors without respect to what’s happening on the social and environmental levels.

The UK agreement

A new free trade agreement with the UK allows New Zealand to remove export tariffs during the next 15 years. This deal promises a GDP boost of up to $1 billion.

On top of the economic elements, the agreement includes conditions for the environment, tackling climate change and creating equity in economic advancement. According to New Zealand Prime Minister, Jacinda Ardern, it is the country’s “first bilateral trade agreement to include a specific article on climate change”. 

The war in Ukraine has had a vast impact on the whole world. In addition to the humanitarian catastrophe, it has also caused increased rates of inflation all over the globe. 

This rise is mostly linked to increases in food, energy prices and disrupted supply chains. The impact is affecting the poorest countries the most. 

Look at the graph below describing the projected inflation rates for several countries, and discuss it with your teacher.

According to Vox Media, the idea of a basic income was, for decades, something of a policy fantasy. However, the last few years have seen it become less fringe and more mainstream. In fact, we now have many limited basic income programs running around the world.

The general idea—that the government should give every citizen a regular infusion of money with no strings attached—has been around since the 16th century. However, the COVID-19 pandemic has given the idea fresh momentum, with the crisis generating significant financial loss and uncertainty.

An interesting situation has emerged in the American stock market. It has caused the stock of several companies to be extremely volatile.

Hedge funds in the US have opened so many short positions—basically, they have bet that stock prices will fall. Now it is believed that they have short sold more than the number of shares available on the market.

However, savvy retail traders noticed this. They started to buy up these shares in large volumes in the hope to push up the price.

This simple equation is at the heart of the global economy: One person’s spending = another person’s income.

It’s referred to as “supply and demand”—producers will supply as much as consumers demand. So if consumers aren’t buying anything, producers won’t be able to sell anything. In other words, whenever you buy something, you pay someone else’s wages.

In 2017, the Tokyo Metropolitan Government estimated that the economic effects of the upcoming Olympic Games will be worth about $292 billion over a span of 17 years. In an attempt to cash in on this, a wide array of businesses in Japan have been ramping up preparations, including the taxi industry.

In January 2018, the Japan Federation of Hire-Taxi Associations formulated measures for the Olympics and Paralympics. The association set a goal of having 9,000 drivers taking English lessons by April, and over 16,000 have already completed them.

The idea of universal basic income (UBI) has been gaining steam around the world. A Japanese billionaire and an American presidential candidate, among others, have both thrown their weight behind it.

The concept is simple: the government provides unconditional money to their citizens. The theory is that in order to provide basic services for all citizens and to stimulate the economy, a small amount of money can be given to each person, equally. 

AirBnB suffered a major blow when Japan’s main tourism body sharply restricted home-sharing, forcing AirBnB to eliminate four-fifths of its 60,000 listings in Japan. The experience illustrates the country’s hesitant approach to the sharing economy, in which people rent goods and services from one another, usually through internet platforms. The sharing economy’s value in Japan is at most ¥1.2trn yen ($11bn), compared with $229bn for China.

The Japanese government and the bank of Japan have announced that they will renew the ¥10,000, ¥5,000 and ¥1,000 banknotes in 2024.

In the US, the widespread belief that the poor are simply lazy has led many states to impose work requirements on aid recipients—even those who have been medically classified as disabled. Limiting aid programs in this way has been shown to shorten recipients’ lives, creating a difference of more than 20 years in life expectancy between the rich and the poor.

The European Union and Japan signed a monumental trade deal in, July 2018, eliminating nearly all tariffs between the entities in one of the world’s largest free-trade deals. The pact, signed in Tokyo, covers a third of the global economy.

The agreement is in stark contrast to President Donald Trump’s trade war and alignment with Russian President Vladimir Putin. Although the leaders didn’t mention him by name, Japanese Prime Minister Shinzo Abe and EU leaders Donald Tusk and Jean-Claude Juncker distanced themselves from Trump’s tactics in a press conference following the deal.