2014 in review: The wow and weird moments in business
Oil hits high and low
June saw oil prices peak at $116 a barrel, and just six months later they have halved to $60 a barrel. Prices plunged further when OPEC decided to keep production at 30 million barrels per day. Exporters such as Canada, Norway, and Russia have seen their currencies tumble on the back of weaker oil prices.
The ruble suffers perfect storm
Russia's currency was decreased in tandem with oil prices, and entered a free fall when it lost more than 20 percent on December 16, 2014. Since, authorities have reversed the plunge with more frequent ruble interventions.
Russia and West go to economic war over Ukraine
The US and EU slapped Russia with several rounds of sanctions, starting in March after Crimea rejoined Russia. The US and EU then hit Russia’s economy- including its oil and finance sector, with the Kremlin responded by banning all agriculture imports from countries that have imposed sanctions against Russia. The ban has hurt Europe, one of Russia's closest business and trade parters, at a time it is trying to kick-start its economy.
Goodbye World Bank, hello BRICS Bank
Brazil, Russia, India, China, and South Africa established a $100 billion bank and $100 billion currency pool to cut out Western financial dominance. The bank will be a resource pool to fund infrastructure projecs in the 5 emerging economies.
China overtakes US in terms of PPP
In 2014 China reached $17.6 trillion or 16.48 percent of the world’s purchasing-power-adjusted GDP, while the US was slightly less, 16.28 percent or $17.4 trillion, according to International Monetary Fund data. This puts it ahead of the US by purchasing power. By GDP the US is still king.
Chinese company makes IPO history in US
US stops printing money, EU considers it
This year the US Federal Reserve stopped printing money as economic activity picks up. On the other side of the Atlantic, the eurozone is facing recession, as it is on the brink of a deflation and fails to fight unemployment and low growth. The European Central Bank is pushing for a US-style stimulus plan, but Germany, the austerity boss, is so far vetoing the idea.
Tax havens lose allure
As the global economy grows, so does the cost of running. That’s why major economies are getting more serious about companies and wealthy individuals paying taxes onshore, and not off.
In October, 51 countries declaredbanking secrecy ‘obsolete’, and signed a pact in Berlin.
Russia introduced a full amnesty for funds returning to the country, as it seeks to bring trillions of dollars back home.
In November, President Vladimir Putin signed an anti-offshore law.
Gold on the run
Between Ukraine reportedly losing $10 billion or nearly all of its gold stockpile, and the Netherlands suddenly deciding to repatriate $5 billion from New York back home, it’s definitely been a weird year for gold. Others, like Germany and Switzerland, have opted to keep some their bullion at the US Federal Reserve.
Argentina defaults, blames US
A New York ‘vulture fund’ demanded Argentina prematurely pay off its debt holders, forcing South America’s third biggest economy into default. Argentina blamed ‘imperialist’ US ‘vulture funds’ for going after the money just 13 years after its $100 billion economic meltdown.