GLOBAL MARKETS FACE A PERIOD OF RENEWED UNCERTAINTY BECAUSE OF ‘NO’ VOTE IN GREEK REFERENDUM – PARSONS
The ‘no’ outcome in the Greek referendum on the failed financial negotiations with the European Union (EU) will immediately inaugurate a renewed phase of uncertainty in financial markets, until greater clarity emerged on possible fresh negotiations between the Greek government and its EU creditors. The markets had not expected a ‘no’ vote and would now need to recalibrate their expectations. The risk of intensified market volatility was high. The referendum result had pushed both Greece and the EU into ‘uncharted waters’ and the outcome was likely to depress markets and the rand for the time being, said Professor Raymond Parsons.
Prof Raymond Parsons
In his opening remarks to the MBA Winter Study School of the North-West University Potchefstroom Business School this morning, Professor Parsons, a professor at the NWU Potchefstroom Business School, said that in the short term much would now depend on whether the European Central Bank would increase its accommodation to the Greek banks this week, failing which the banking system in Greece ‘will grind to a halt’, and the recreation of a separate Greek currency would become more likely for the country to finance itself. The overarching problem was that the Greek economy was now basically ‘both illiquid and insolvent’, he said. This needed to be addressed immediately if the ‘melt-down’ in the Greek economy was to be reversed. More…
Me. Carike Claassen reports on her visit to the International Symposium on Service Learning at the University of Indianapolis:
The conference bus
More than anything else, Indianapolis is probably known for the Indy 500 that takes place there annually. This year, the race was held on 24 May. I arrived in Indianapolis on 26 May, ever so fashionably late. But never mind, since all I really know about the Indy 500 is Danica Patrick, and some vague reference to it made in a Beach Boys song. I had other business to attend to.
My real purpose for visiting Indianapolis was to attend the International Symposium on Service Learning, hosted by the University of Indianapolis. Forget the Indy 500 – this is where the truly impressive things happen!
The Pack Away Hunger Project
For those not familiar with the term, “service learning” refers to a method of teaching in which students learn about their chosen subjects, while doing community service. So, for instance, students who are studying nursing get some hands-on experience by volunteering at local clinics. The University of Indianapolis has done impressive work in this area. In fact, their very motto is: Education for Service. More…
Our Research posts are about the latest academic research being done in the School of Economics. This week:
The Wal-Mart/Massmart merger: Implications of foreign direct investment for national sovereignty
by Dr. Henri Bezuidenhout & Prof. Ewert Kleynhans
This study analyses strategic considerations for states that allow foreign corporations to engage in their domestic markets. The Wal-Mart/Massmart merger has caused concern about its possible influence on the South African economy, employment and the autonomy of the state. Globalisation and transnational harmonisation have led to an impetus for corporations to extend their activities across national borders and foreign markets. Based on the theory of sovereignty, this is evaluated against a trilateral background of home country, host country and corporation. The outcome that emerges is that in some cases states have lost a significant share of sovereignty to multinational authorities. With the Wal-Mart/Massmart merger, role-players such as the government, competition commission and trade unions got involved early on and ensured maximum advantage to the country and its citizens. The final conclusion is that such partnerships between host, home governments and transnational corporations can minimise the loss of national sovereignty, but can only be achieved against a backdrop of economic, societal and political stability and co-operation.
This research is published in The South African Journal of International Affairs. 22(1):93-110
Last week Proff. Marianne Matthee and Waldo Krugell attended the 16th Conference on International Economics in San Sebastian, Spain.
The conference was organised by the Spanish Association of International Economics and Finance (AEEFI) and the Department of Economics of Deusto Business School, University of Deusto. The line-up included two top keynotes: Pol Antras of Harvard University who spoke on the topic “Trade, inequality and costly redistribution” and Keith Head, currently at the LSE, who spoke on the topic “Brands in motion: how frictions shape multinational production”. The two excellent presentations were complemented by theoretical and applied work presented by academics from Spanish and other European universities. See the full programme here.
The conference also provided the opportunity to meet with a co-author of Prof Matthee, Dr Maria Santana Gallego (Universidad de las Islas Baleares), who presented a paper on the effect of the euro on international tourism flows.