How will the Belt and Road Initiative impact the global economy? | Podcast
Talking points on this podcast:
- Brexit is finally here: what is the outlook for the UK and the City of London?
- China’s Belt and Road Initiative: How will it impact the global economy?
- Can the bull run in stocks continue, or is there a reappraisal on the cards?
This time on Trading Global Markets Decoded, our host Martin Essex is joined by Douglas McWilliams, an expert in economic forecasting and analysis. Douglas currently advises 25 of the UK’s FTSE 100 companies, most of the UK’s top retailers, four out of the UK’s top 10 legal firms and a range of leading accountants. In this edition, we talk about Brexit’s arrival and the impact on the UK economy, the outlook for China’s Belt and Road infrastructure initiative, and the ongoing march of tech stock valuations.
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Brexit is here: How will it affect the UK economy?
Brexit’s arrival is the first topic on the agenda. As someone who voted in favor of Brexit, how does Douglas see it affecting the UK economy and London’s financial hub at this point? “My view is that Brexit is damaging in the short term and probably positive in the long term. We have lost some inward investment and we’ve had some gyrations in the Pound, although some of those might have happened anyway,” he says.
“There will be some sectors that may lose out, depending on what deal we get with the EU, and that is a matter for negotiation. The insurance sector may not do terribly well; certain parts of manufacturing – particularly cars – also may not, but it is all dependent on a deal yet to be done, and we’ll have to see what happens.”
What is China’s Belt and Road Initiative?
China’s Belt and Road Initiative is a multi-billion-dollar infrastructure development consisting of a network of overland roads and shipping lanes. The project aims to connect Asia, Africa and Europe, and facilitate international trade – but how much potential is there for the global economy?
“I do think it is a project that is transformative, particularly for those countries in the middle like Mongolia. They’ll be able to export all their commodities, and the place is full of commodities,” Douglas says.
“Our estimate is that eventually this will boost the world economy by about $70 billion. There is enough volume of trade now to open this up and make it a success.”
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.