Laos faces unprecedented financial difficulties, including US$14.5 billion worth of public and publicly guaranteed debt — around half of which is owed to China. But unlike Sri Lanka, there is no chance that Laos will default on its external debt obligations. China, its largest creditor and political ally will not let Laos default.           The size of Laos’ debt obligations makes it seem like the default is inevitable. The country’s total public and publicly guaranteed debt stock was 88 percent of GDP in 2021. With an average of US$1.3 billion worth of yearly debt servicing owed between 2022 and 2026, the Lao government needs to seek debt service deferral and continue to refinance its existing debt stock. Laos also faces a liquidity challenge — it does not have enough assets to meet its external debt obligations — with its foreign exchange reserves (US$1.3 billion) equal to the annual amount needed to service its debt.           Geo-economic factors mean that the concerns about Laos defaulting are unrealistic. The

          International trade has been part of the world economy for thousands of years. Despite this long history, the importance of foreign trade was modest until the beginning of the 19th century—the sum of worldwide exports and imports never exceeded 10% of global output before 1800. Then around 1820 started to change quickly. Around that time, technological advances and political liberalism triggered what we know today as the ‘first wave of globalization.         This first wave of globalization came to an end with the beginning of the First World War, when the decline of liberalism and the rise of nationalism led to a collapse in international trade. But this was temporary, and trade started growing again after the Second World War. This second wave of globalization, which continues today, has seen international trade grow faster than ever before. Today, around 60% of all goods and services produced in the world are shipped across country borders. In just a few generations, globalization completely changed the world economy.           Nowadays, The

          Foreign Direct Investment (FDI) is a scheme used when any individual or company holds at least a 10% share of any foreign company. It is also described that the investment made by any individual or firm in countries apart from the country of their origin. FDIs are distinct from portfolio investments as they involve a long-term relationship and control of the investee’s company. Multinational corporations (MNCs) and multinational enterprises (MNEs) are two common names for foreign direct investors.           The main purpose of FDIs is to gain new markets and access to natural resources, labor, and technology. By investing directly in another country, companies are able to avoid the tariffs and other trade barriers between their home country and the target market. Additionally, FDI allows companies to benefit from the lower costs associated with production in developing countries. FDIs can be made through various mechanisms, such as setting up a new subsidiary or joint venture, acquiring an existing company, or investing in real estate.           In accordance with

     A public weary of virus precautions pushed up consumption of goods and services, but the longer-term picture is uncertain as the global economy weakens. Shoppers have poured back onto Tokyo’s streets in recent months.      TOKYO — Restaurants are full. Malls are teeming. People are traveling. And Japan’s economy has begun to grow again as consumers, fatigued from more than two years of the pandemic, moved away from precautions that have kept coronavirus infections at among the lowest levels of any wealthy country.      Lockdowns in China, soaring inflation, and brutally high energy prices could not suppress Japan’s economic expansion as domestic consumption of goods and services shot up in the second three months of the year. The country’s economy, the third largest after the United States and China, grew at an annualized rate of 2.2 percent during that period, government data showed on Monday. The second-quarter result followed the growth of 0 percent — revised from an initial reading of a 1 percent decline — during the first three months of the year when consumers

What is savings?           Saving is income not spent or deferred consumption. Methods of saving include putting money aside in, for example, a deposit account, a pension account, an investment fund, or cash. Consumer spending is what households spend to fulfill everyday needs. This private consumption includes both goods and services. Saving is closely related to physical investment, in that the former provides a source of funds for the latter.           Economics is divided on the role of savings. Many economists believe that saving is a personal virtue but social vice. This is because if all the people start saving, the expenditure will go down. Since the current system measures GDP and economic growth based on expenditure, a higher savings rate makes it appear like the economy is not growing. In fact, it may appear like the economy is about to enter a recession. On the other hand, many economists do acknowledge that this GDP-based view of savings is incorrect. They refer to unanimity in all of economic history. No country in