BBC: EU referendum: CBI warns of UK exit 'serious shock'
This we found and said (week 09/2016):
- UK perform on a rather high level, but declining efficiency and some notable weaknesses don't explain relatively high impacts of UK's national intangible capital.
- UK's trade strucure gives UK significant NIC spillovers (when compared to other countries) which in part explain why UK perform well when it comes to NIC impacts. However, this NIC (spillover) is "trade/co-operation dependent" and mostly linked to EU.
- Strenghts and weaknesses for UK's NIC are "bipolar": Evident strenghts are human and process capital, weaknesses market and renewal capital. Weak renewal capital benefit from secondary strenghts, (EU) spillovers, human and process capital, but raises concerns facing a Brexit, as renewal capital is a crucial main driver for developed countries.
- Base projection for NIC Tipping point is slightly beyond 2020 +. Tipping point will most likely be caused by weak output performance drivers, primary within market and process capital, renewal capital not to forget. Brexit may drag NIC Tipping point for UK nearer the end of this decade, 2019 +/-.
- Brexit would seriously hamper EU development. Likevise: UK would lose present and future benefits from deepening EU integration.
Now in the news (BBC):
A UK exit from the EU would cause a "serious economic shock", potentially costing the country £100bn and nearly one million jobs, according to a report commissioned by the CBI. (CBI = Confederation of British Industry).
To quantify the impact on the economy, the CBI commissioned professional services firm PwC (PwC = PricewaterhouseCoopers / world leader, professional auditing and accounting services) to examine two different exit scenarios: one at the optimistic end of the range, and the other recognising the likelihood of difficult trade negotiations but nonetheless with trade deals being concluded. Both scenarios use moderate assumptions – significantly more pessimistic cases could be constructed.
Under both PwC scenarios, UK living standards, GDP and employment are significantly reduced compared with staying. The analysis indicates a cost to the British economy of leaving of as much as £100 billion – the equivalent of around 5% of GDP - by 2020. Even in a scenario where a Free Trade Agreement with the EU is secured rapidly, the analysis indicates GDP could be 3% lower by 2020. GDP per household in 2020 could be between £2100 and £3700 lower, and the UK’s unemployment rate between 2 and 3 percentage points higher, than if the UK had remained in the EU. GDP growth in the years 2017-2020 could be seriously reduced – and possibly be as low as zero in 2017 or 2018.
Summary by BBC:
Ms Fairbairn (CBI): "The economy would slowly recover over time, but never quite tracks back to where it would have been. Leaving the EU would mean a smaller economy in 2030."
Resources: In the news BBC / Irish Examiner / Full CBI story / Full PwC report
Summary:
- Brexit would seriously hamper EU development. Likevise: UK would lose present and future benefits from deepening EU integration.
NIC on the week: Next update 12:00 CET 22/03/2016.
Next up: Turkey: In the middle of the migration crisis Turkey is making its way towards EU. We analyse Turkey NIC and challenges ahead ...
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Any questions? Mail a NIC team member or mail your question to: nic research.
NOTE:
Till official release and publication of NIC 2016 Report in April (2016) we elaborate only NIC 2001-2013/14 public data based analysis and results, i.e. data available to all. Customers find latest NIC 2016 data and analysis results on login area. However: Elaborations and results presented here are tried to be in line with results you will find in the NIC 2016 Report and database.
Turkey: Making its way towards EU
Economic background
Turkey is the 27th largest export economy in the world and the 40th most complex economy according to the Economic Complexity Index (ECI). In 2013, Turkey exported $164B and imported $225B, resulting in a negative trade balance of $60.6B. In 2013 the GDP of Turkey was $822B and its GDP per capita was $18.8k.
The top export destinations of Turkey are Germany ($15.5B), Iraq ($11.9B), the United Kingdom ($8.92B), France ($7.7B) and Italy ($7.26B). The top import origins are Germany ($25.8B), China ($24.3B), Russia ($14.5B), Italy ($13.2B) and the United States ($12.1B). (Image and source: OCE ).
From the economic point of view this positions Turkey between Spain and Poland in EU:
Basic national intangible capital NIC of Turkey 2014
We start by making a brief comparison of Turkey to two neighbours, Greece and Bulgaria, and to the two economic EU neighbours, Poland and Spain. NIC Index ranks for the countries 2014:
Bulgaria (53/59), Greece (38/59), Turkey (50/59), Spain (30/59) and Poland (41/59)
... NIC impact in GDP formation:
... NIC efficiency:
... NIC development:
Summary:
- Turkey perform on a rather low NIC level below EU averages, but has made steady (moderate) progress in pace with Poland and Bulgaria. Turkey general NIC performance is close to neighbouring Bulgaria and Greece, but somewhat below economic neghbours in EU, Poland and Spain.
This is a developing story: Next update 12:00 CET 23/03/2016.
Turkey: Strenghts and weaknesses ...
Stay tuned!
Any questions? Mail a NIC team member or mail your question to: nic research.
NOTE:
Till official release and publication of NIC 2016 Report in April (2016) we elaborate only NIC 2001-2013/14 public data based analysis and results, i.e. data available to all. Customers find latest NIC 2016 data and analysis results on login area. However: Elaborations and results presented here are tried to be in line with results you will find in the NIC 2016 Report and database.
Tribute to victims of 22.03.2016
NIC on the week: Next update 12:00 CET 24/03/2016.
Stay tuned!
Any questions? Mail a NIC team member or mail your question to: nic research.
NOTE:
Till official release and publication of NIC 2016 Report in April (2016) we elaborate only NIC 2001-2013/14 public data based analysis and results, i.e. data available to all. Customers find latest NIC 2016 data and analysis results on login area. However: Elaborations and results presented here are tried to be in line with results you will find in the NIC 2016 Report and database.
Turkey: Strenghts and weaknesses
Recap:
- Turkey perform on a rather low NIC level below EU averages, but has made steady (moderate) progress in pace with Poland and Bulgaria. Turkey general NIC performance is close to neighbouring Bulgaria and Greece, but somewhat below economic neghbours in EU, Poland and Spain.
Estimating strenghts and weaknesses
Calcualting strenghts and weaknesses and trying to present a compact (short) list we need to observe NIC index values as potential for sustained future growth, impacts of driver as present economic value of driver and efficiency as a measure of cost and investment returns. In addition we need to observe intrinsic and global dimension.
For each driver (indicator) we therefore calculate:
- Distance to group average, i.e. D1 = value - average(group) with a weight = 1. Motivation: Internal weaknesses and strenghts need to acknowledge intrinsic differences between different NIC capital groups.
- Distance to world average for driver, i.e. D2 = value - average(world) with a weight = 2. Motivation: Internal weakness / strenght does not automatically imply that this is true when compared to world averages.
- Distance to NIC trade value, i.e. D3 = value - NIC trade value with a weight = 3. Motivation: Strenghts and weaknesses need to be measured in the economic realm of production and trade as country specific.
- Weighted distance, i.e. WD =(D1*1 + D2*2 + D3*3)/6
Weights are here chosen to reflect what matters: What matters more than just high values (in group) is that the value is competitive (vs world) and generates economic activity (competitive trade). And the result for Turkey:
We believe this is a more true picture of how strenghts in national intangible capital is distributed. However, still, we ask once more:
When looking for strenghts and weaknesses: are drivers potential (index values), impact (as percentage shares in GDP formation and growth) and efficiency (as output/input ratio for economic impacts) equally important?
One can argue that they are equally important and should be given equal weights and analysed separately. This is OK and is certainly done. However, if we seek a compact list of weaknesses and strenghts combining potential, impact and efficiency (dynamically) we could give impact greatest weight followed by efficiency and potential. The rationale is that focusing on improving any (weak) driver will innevitably also strenghten its efficiency and its potential, but benefits in impacts will be fastest and strongest when initially impact has highest SWOT selective power.
Giving impact, efficiency and potential weights 3, 2 and 1 (and calculating Doubble Weighted Distance DWD) we can picture how strenghts and weaknesses are distributed over the various NIC capitals in Turkey:
Turkey strenghts
More closely:
Turkey weaknesses
More closely:
Turkey strenghts and weaknesses in imbalance when considering Turkey's developmental stage
More closely:
Summary:
- Turkey perform on a rather low NIC level below EU averages, but has made steady (moderate) progress in pace with Poland and Bulgaria. Turkey general NIC performance is close to neighbouring Bulgaria and Greece, but somewhat below economic neghbours in EU, Poland and Spain.
- Focus should shift to strenghten national human capital NHC.
NIC on the week: Next update 12:00 CET 29/03/2016.
Happy Easter 2016
Stay tuned!
Any questions? Mail a NIC team member or mail your question to: nic research.
NOTE:
Till official release and publication of NIC 2016 Report in April (2016) we elaborate only NIC 2001-2013/14 public data based analysis and results, i.e. data available to all. Customers find latest NIC 2016 data and analysis results on login area. However: Elaborations and results presented here are tried to be in line with results you will find in the NIC 2016 Report and database.
NIC on the week: Next update 12:00 CET 29/03/2016.
Stay tuned!
Any questions? Mail a NIC team member or mail your question to: nic research.
NOTE:
Till official release and publication of NIC 2016 Report in April (2016) we elaborate only NIC 2001-2013/14 public data based analysis and results, i.e. data available to all. Customers find latest NIC 2016 data and analysis results on login area. However: Elaborations and results presented here are tried to be in line with results you will find in the NIC 2016 Report and database.