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As apprehension grows in China, Europe, and Japan about a possible trade war triggered by the incoming Trump administration, one should also spare a thought for developing countries. Their tried-and-tested method of expanding beyond agriculture to achieve middle-income status has been to embrace low-skilled export-oriented manufacturing. How will these countries fare now?Their prospects may be better than expected, especially if they choose alternative development paths. In the past, poor countries developed through manufacturing exports because foreign demand allowed their producers to achieve scale, and because abysmal agricultural productivity meant that low-skilled workers could be attracted to factory jobs even with low wages. This combination of scale and low labour costs made these countries’ output globally competitive, despite their workers’ lower relative productivity.As firms profited from exports, they invested in better equipment to make workers more productive. As wages rose, workers could afford better schooling and healthcare for themselves and their children. Firms also paid more taxes, allowing the government to invest in improved infrastructure and services. Firms could now make more sophisticated, higher-value-added products, and a virtuous cycle ensued. This explains how China moved from assembling components to producing world-leading electric vehicles (EVs) in just four decades.Visit a cell-phone assembly plant in a developing country today, however, and it is easy to see why this path has become more difficult. Rows of workers no longer solder parts onto motherboards, because the micro-circuitry has become too fine for human hands. Instead, there are rows of machines with skilled workers tending to them, while unskilled workers primarily move parts between machines or keep the factory clean. These tasks, too, will soon be automated. Factories with rows of workers stitching dresses or shoes also are becoming rarer.Automation in developing countries has a variety of implications. For starters, manufacturing now employs fewer people, especially unskilled workers, per unit of output. In the past, developing countries moved steadily to more sophisticated manufacturing, leaving less-skilled manufacturing to poorer countries that were just embarking on the export-led-manufacturing path. But now, a country like China has enough surplus workers to undertake all manner of manufacturing. Low-skilled Chinese workers are competing with Bangladeshi counterparts in textiles, while Chinese PhDs compete with German counterparts in EVs.Moreover, given the declining importance of labour in manufacturing, industrialised countries have come to believe they can restore their own competitiveness in the sector. They already have the skilled workers who can tend the machines, so they are raising protectionist barriers to re-shore production. (Of course, the primary political motive is to create more well-paying jobs for left-behind high school-educated workers, but automation makes this unlikely.)Taken together, these trends – automation, continued competition from established players like China, renewed protectionism – have already made it harder for poor countries in South Asia, Africa, and Latin America to pursue export-led manufacturing growth. Thus, while a trade war would be damaging to their commodity exports, it would not be as concerning as in the past. It may even have a silver lining if it compels developing countries to search harder for alternative paths.That path could be paved with high-skilled services exports. In 2023, global trade in services expanded by 5% in real (inflation-adjusted) terms, while merchandise trade shrank by 1.2%. Improvements in technology during the Covid-19 pandemic enabled more remote work, and changes in business practices and etiquette have minimised the need for physical presence. As a result, multinationals can and do serve clients from anywhere. In India, multinational firms ranging from JPMorgan to Qualcomm are hiring talented graduates to staff global capability centres (GCCs), where engineers, architects, consultants, and lawyers create designs, contracts, content, and software that are embedded in manufactured goods and services sold globally.Every developing country has a small but highly skilled elite who can profitably export skilled services, given the high wage differentials vis-à-vis developed countries. Workers who know English (or French or Spanish) may be particularly advantaged, and even if only a few have these capabilities, such jobs add much more domestic value than low-skilled manufacturing assembly, thus contributing enormously to a country’s foreign-exchange earnings.Moreover, each well-paid service worker can create local employment through his or her own consumption. As more moderately skilled service workers – ranging from taxi drivers to plumbers to waiters – find steady employment, they will cater not just to elite demand but also to each other. High-skilled services exports only need to be the leading edge of broader job growth and urbanisation.All job growth, however, requires improvements in the quality of a country’s labour pool. Some “last-mile” training and upgrading can be done quickly; as long as engineering graduates have basic knowledge of their field, they can be trained in state-of-the-art design software that a potential multinational employer needs. But over the medium term, most countries will need to invest substantial amounts in nutrition, health, and education to augment their peoples’ human capital.Fortunately, these investments can also create employment. With the right development-appropriate policies, governments can substantially improve learning and health across the population. This may mean hiring more high-school-educated mothers in daycares to help teach children basic literacy and numeracy at an early age; or training more “barefoot” medical practitioners to recognise basic ailments, prescribe medicines, or make referrals to qualified physicians when necessary.Developing countries need not abandon manufacturing, but they must explore other paths to growth. Instead of benefiting one sector or another through industrial policy, they should invest in the kinds of skills that are important for all jobs.Services are especially worth exploring, because developed economies are unlikely to erect protectionist barriers against them. As the world’s largest service exporters in 2023, the European Union, the US, and the United Kingdom have much to lose from a trade war in this domain. Insofar as global services competition affects their own workforce, it would be felt most strongly by doctors, lawyers, bankers, consultants, and other high-income professionals, implying a boon for consumers of these services in developed countries and potentially even reducing domestic income inequality. Those would be worthwhile outcomes in themselves. - Project SyndicateRaghuram G. Rajan, a former governor of the Reserve Bank of India and chief economist of the International Monetary Fund, is Professor of Finance at the University of Chicago Booth School of Business and the co-author (with Rohit Lamba) of Breaking the Mold: India’s Untraveled Path to Prosperity.

US President-elect Donald Trump’s return to the White House signals a potential break from decades of American leadership in global health. While Trump’s isolationist “America First” agenda may resonate with voters eager to see their tax dollars redirected toward domestic priorities, a US withdrawal from multilateral public-health initiatives would carry serious risks.To be sure, there is a strong case for health self-sufficiency. Operation Warp Speed, launched during Trump’s first term, accelerated vaccine development and deployment, playing a pivotal role in controlling the Covid-19 pandemic and facilitating America’s economic recovery. But the notion that isolationism could shield Americans from the effects of global health crises is deeply misguided. The 2014-16 Ebola outbreak in West Africa cost the $1.1bn and 12,000 jobs, even with just 11 cases reported on American soil.The ongoing mpox outbreak, which originated in Central Africa and has since spread to more than 120 countries, serves as a stark reminder of how quickly public-health threats can escalate into global emergencies. A true “America First” strategy would focus on investing in robust surveillance and containment systems.Investing in global health also makes strategic sense. As US firms seek to diversify their supply chains away from China, they require alternative manufacturing hubs with healthy and productive workforces. Countries with robust health systems are best positioned to fill this role.Moreover, strengthening health systems in developing countries reduces migration pressures – a key concern for US voters – by addressing the root causes of displacement. Consider, for example, the President’s Emergency Plan for Aids Relief (PEPFAR), launched by then-President George W Bush in 2003. With $110bn in overall funding, PEPFAR has saved 26mn lives and accelerated economic growth in recipient countries since its inception. Studies comparing data from 2004 to 2018 revealed that PEPFAR contributed to a 2.1-percentage-point increase in the rate of per capita GDP growth, leading to a remarkable 45.7% rise in per capita GDP compared to 2004 levels.Beyond its direct impact, PEPFAR’s disease-surveillance infrastructure has proven invaluable in managing subsequent health crises. It has also bolstered America’s global standing, with countries receiving PEPFAR support consistently reporting higher approval ratings for the US.But the traditional aid model is long overdue for a radical transformation. Across the developing world, particularly in Africa, market-driven solutions are revolutionizing health care. In countries like Kenya and Nigeria, entrepreneurs are pioneering innovative, profitable models that combine digital systems, standardised protocols, and strategically located clinics to provide quality healthcare to middle- and lower-income populations.Such ventures present significant opportunities for US investors seeking to enter the growing market for accessible health care in emerging economies. With some adjustments, America’s development-finance tools could facilitate the transformation of Africa’s healthcare systems. The US International Development Finance Corp, which has $60bn at its disposal, is well-positioned to de-risk private investments in health ventures and attract additional capital through various forms of financing.Early experiments appear promising. Stichting Medical Credit Fund, for example, has provided more than $100mn in loans to health-care facilities across the continent while maintaining a remarkable 96% repayment rate. Other innovative mechanisms, such as development-impact bonds, have shown that market incentives can improve health outcomes.Nearly five years after the start of the pandemic, the world is grappling with several major health threats, from HIV/AIDS to malaria, which kills 619,000 people annually, most of them children. Critics may argue that eliminating these diseases is a pipe dream, but the same was once said about eradicating smallpox. If anything, Operation Warp Speed has demonstrated that American ingenuity, when harnessed effectively, can achieve the seemingly impossible.The stakes are much higher than they may seem. In recent years, Africa has emerged as a key battleground in the escalating Sino-American rivalry. Through the “Health Silk Road” – an extension of its Belt and Road Initiative – China has funded 400 health-care infrastructure projects across the continent. During the Covid-19 pandemic, it sent medical experts to 17 African countries, using bilateral agreements to deepen trade and diplomatic ties.America stands to lose far more than influence. To meet the needs of its growing population, Africa must finance massive investments in health infrastructure. The world power that fills this gap will not only reap financial rewards but also will gain preferential access to the continent’s vast reserves of critical minerals – essential for clean-energy technologies and advanced manufacturing. Notably, in African countries and regions where US health programs have been curtailed, Chinese firms have quickly stepped in, building hospitals and providing medical equipment, often in exchange for mining rights.As competition for these resources intensifies, health diplomacy will become increasingly vital for securing America’s industrial future, a central pillar of Trump’s economic agenda. By focusing on targeted investments in areas where its interests align with global health priorities, the US can generate significant returns while maintaining cost efficiency.In an increasingly interconnected world where the next pandemic disease outbreak is only a matter of time, investing in global health security is a form of disaster insurance. The choice facing the incoming Trump administration is clear: reclaim America’s health leadership or grapple with the far-reaching consequences of disengagement.Persuading a sceptical electorate that investing in global health serves US interests will undoubtedly be challenging. But Trump has an opportunity to silence his detractors and create a health legacy that surpasses anything his predecessors achieved. - Project SyndicateWalter O Ochieng is a physician and global health researcher at the Africa Institute for Health Policy. Tom Achoki, a former Sloan fellow at MIT, is Co-Founder of the Africa Institute for Health Policy.

After decades on the fringes of economic debate, industrial policy has enjoyed a resurgence in recent years, with the US, the European Union, and China all ramping up their efforts to promote strategic sectors. Even the International Monetary Fund – once a vocal critic of industrial policy – has recently come around to endorsing it.The reasons for this shift are obvious. The Covid-19 pandemic and geopolitical shocks, especially Russia’s invasion of Ukraine, have disrupted global supply chains, causing shortages and fuelling inflation. Meanwhile, transformative breakthroughs in artificial intelligence and clean-energy technologies have triggered a race between major powers like the US and China for dominance in these rapidly evolving fields.The bigger question is what it will take for today’s industrial policies to succeed. After all, the late-twentieth-century shift toward market-driven economic policies was largely a reaction to the failures of state interventions in the 1970s. Back then, efforts to promote national “champions” often led governments to prop up uncompetitive industries or back technologies that proved obsolete. Why should this time be any different, given that politicians remain highly susceptible to corporate lobbying and influence campaigns?To avoid repeating the mistakes of the past, policymakers must resist the urge to pick winners, whether specific companies or favoured technologies. Sadly, politicians are often dazzled by wealthy and powerful executives, especially in an era marked by staggering fortunes and little-understood innovations like AI.Compounding this issue, many politicians today are less likely than their predecessors to have direct experience in business. Consequently, they may be insufficiently sceptical of the promises made by companies and executives seeking government support.This ever-present risk underscores the importance of independent and robust antitrust enforcement. Although independent competition authorities have long been recognised as a safeguard against corporate lobbying, the rise in market concentration across OECD countries over the past few decades suggests that competition rules have been severely under-enforced.But times have changed. Recognising the risks posed by increasing market power, US President Joe Biden’s administration adopted a more aggressive antitrust policy, while the European Union and the United Kingdom have introduced new legislative frameworks aimed at regulating digital markets. With AI and green technologies set to transform the global economy, sustaining this momentum is crucial to ensuring that new entrants and emerging companies have the space to innovate and grow.Like competitive and open markets, industrial policies can play a vital role in boosting productivity and economic growth while helping governments resist undue corporate influence. But their success hinges on a nuanced understanding of the challenges and opportunities facing specific industries.Regrettably, the institutional expertise that characterized government agencies during the postwar era has steadily diminished since the 1980s. In the UK, for example, senior officials in the forerunners of the current Department for Business and Trade once had deep knowledge of key sectors like the auto industry. They were familiar with companies across the supply chain, maintained direct relationships with top executives, and were well-versed in the latest management practices and technical innovations. Many were engineers by training, giving them an invaluable perspective on the industries they oversaw.By the 1990s, this expertise had largely vanished as industrial policies were abandoned. Many experienced officials – their roles diminished in importance – left public service. Today, senior civil servants oversee a wide range of industries, leaving them with little, if any, sector-specific knowledge.For industrial policies to be effective, policymakers must move beyond the vague rhetoric about national strengths that characterizes the current policy debate. Instead, they should focus on the specific products, services, and technologies for which their countries have a proven comparative advantage. This kind of industry-specific expertise is essential for any successful industrial policy.Without these skills, today’s industrial policies might fail to strike a “Goldilocks” balance between supporting strategically important industries and maintaining market competition. In other words, they could become overly influenced by corporate interests while lacking the specialised knowledge and technical understanding required to guide domestic industries effectively.To be sure, acquiring the necessary know-how to craft effective industrial policies could be a long-term undertaking requiring significant commitment. But as the world moves beyond the outdated notion that markets and governments operate in isolation, policymakers must develop the know-how and skills needed to work collaboratively with domestic industries. While capacity-building is never a simple process, it is critical to ensuring that the new industrial policies succeed. – Project SyndicateDiane Coyle, Professor of Public Policy at the University of Cambridge, is the author of Cogs and Monsters: What Economics Is, and What It Should Be (Princeton University Press, 2021) and the forthcoming The Measure of Progress: Counting What Really Matters (Princeton University Press, Spring 2025).

The Ministry of Public Health (MoPH) has developed an advanced occupational and environmental medicine programme in collaboration with the World Health Organisation's (WHO) Regional Office for the Eastern Mediterranean. The programme is one of the outputs of the occupational health objectives outlined in the Second National Health Strategy.MoPH said that a work plan has been established to implement the advanced programme as part of the Occupational Health and Safety (OHS) Initiative, a priority under the National Health Strategy 2024-2030.A scientific committee, comprising MoPH staff, an expert from the WHO Regional Office for the Eastern Mediterranean, and WHO representatives, was formed to study and outline a mechanism for the programme's national implementation and to identify trainees, targeting specialists and consultants in occupational medicine, family medicine, and community medicine.The advanced occupational and environmental medicine programme is the first of its kind in the WHO Eastern Mediterranean Region.In this context, the MoPH recently organised a training workshop for trainers on the advanced occupational and environmental medicine programme, in collaboration with the WHO Regional Office for the Eastern Mediterranean and the WHO Country Office in Qatar.The workshop was part of the strategy to build national capacity in the field of occupational health in Qatar. The Ministry's Occupational Health Section, in partnership with the WHO, developed the advanced occupational and environmental medicine curriculum to equip healthcare professionals with the skills necessary to identify and manage occupational injuries and diseases, as well as to conduct occupational and environmental exposure assessments.The workshop aimed to update knowledge and skills in occupational and environmental medicine by sharing experiences among participants from diverse work environments. It reviewed and clarified concepts such as occupational diseases and work-related illnesses, standardised the understanding of occupational health and safety concepts, and addressed professional practices in preventive and therapeutic occupational and environmental medicine. It also identified challenges in applying these practices at the national level.In his opening remarks at the workshop, Acting Director of the Health Promotion Department at MoPH, Dr Salah Alyafei welcomed WHO representatives and praised the collaboration between the Ministry, the WHO Regional Office for the Eastern Mediterranean, and the WHO Country Office in Qatar in achieving the Qatar National Vision 2030.He emphasised that this training reflects the Ministry's commitment to improving the health and well-being of workers, noting that workers' health directly contributes to the growth and development of the national economy and promotes sustainable development.In turn, WHO Representative in Qatar Dr Rayana Bou Haka highlighted the importance of the training workshop in achieving one of the shared objectives between the WHO and MoPH, such as implementing programmes to enhance knowledge and skills for addressing and preventing workplace risks across various sectors. She noted that lessons from the Covid-19 pandemic underscored the need to improve response plans to protect workers.For her part, Occupational Health Officer at the WHO Regional Office for the Eastern Mediterranean Dr Rola Imam commended Qatar for leading the training of trainers in implementing the advanced occupational and environmental medicine programme.Head of the Occupational Health Section at MoPH Dr Mohammed Ali al-Hajjaj, stated that the workshop was part of the action plan for building the capacity of health practitioners, which includes various training phases to enhance knowledge in occupational and environmental medicine among primary healthcare physicians and other specialists, thus supporting and improving occupational health practices and service delivery.

International flights into Shanghai, Beijing and Hong Kong are set to jump in 2025, almost completing the cities’ recoveries to pre-pandemic totals. It’s a different story in the rest of the world as the industry navigates cost-of-living crises, broken supply chains and regional conflicts.Cathay Pacific Airways Ltd’s services into Shanghai, China’s financial heart, are set to surge 48% to more than 4,000 in the 12 months through November next year, according to airline schedules compiled by Cirium. Air China Ltd, China Southern Airlines Co and Hainan Airlines Holding Co are among others planning to operate hundreds more overseas flights into Beijing versus the previous 12 months, the data show.With foreign visitor numbers to China still in the doldrums, Chinese carriers inevitably account for many of the additional international services. More Chinese citizens are venturing overseas and back following a post-Covid domestic travel boom.Meanwhile, international air traffic to established hubs such as London, Dubai and Doha will falter or even reverse next year, the schedules indicate. In New York, the volume of incoming overseas flights will decline in the year through November, the Cirium data show. That would be the first decrease since the pandemic halted global travel in 2020.The schedules reflect an aviation industry operating at different speeds and facing an array of challenges. Passenger demand next year will be strongest in the Asia-Pacific region, which emerged from Covid later than Europe and the US and is therefore coming off a lower base, according to the most recent outlook from the International Air Transport Association.“It’s a very fractured market — but it’s still showing growth as far as the Chinese recovery is concerned,” said Subhas Menon, director general of the Association of Asia Pacific Airlines. “The fly in the ointment is really the supply chain issues affecting the industry.”Flight network growth at many airlines, particularly those in the US, continues to be limited by Boeing Co.’s production woes and shortfalls in the supply of engines and other critical components in the wake of the pandemic. Airlines expect these problems to be a constraint beyond 2025.Also in China’s favour is the decision by the US to ease its travel warning last month. The US travel advisory for China now matches the designation for countries such as France, Germany and India. China’s protracted rebound has made Shanghai Pudong the world’s fastest-growing airport, according to OAG data.Asia dominates this month’s rankings of the world’s busiest overseas routes, too.Pockets of weakness aside, a record 5.2bn passengers will still take to the skies in 2025, according to IATA, pushing airline industry revenue past $1tn for the first time.According to Subhas, many US carriers have little incentive to operate more international flights because profitability on domestic routes is so good. Airlines that plan to run fewer overseas flights to New York include Virgin Atlantic Airways Ltd, British Airways and Deutsche Lufthansa AG, the data show.

NBA superstar LeBron James celebrates his 40th birthday on Monday, the milestone carrying him to yet another first in a league in which he has starred for more than two decades - with the clock still running. The Los Angeles Lakers great will become the first NBA player ever to play in his teens, 20s, 30s and 40s.A four-time champion, four-time NBA Most Valuable Player and four-time Finals MVP, James continues to excel. In his 22nd season he’s averaging 23.5 points, nine assists and 7.5 rebounds per game.Having surpassed Kareem Abdul-Jabbar as the league’s all-time scoring leader in February of 2023 he has taken his total to 41,131.Still in his sights is the record for baskets made - James’s 15,088 trailing Abdul-Jabbar’s 15,837 - and the record for most games played. With 1,520 he’s fifth on that list topped by the 1,611 of Robert Parish.“It’s just commitment to the craft and to the passion and love I have for the game,” James said when he set the minutes-played mark on December 19.“It’s kind of mind-boggling just to be in this position coaching him, playing against him for 15 years, taking three years of calling his games and then he’s still playing at this level,” said JJ Redick, the 40-year-old who played 15 seasons in the NBA then served as a TV commentator before being named head coach of the Los Angeles Lakes in June.“Feels like he’s just been doing this forever, and not a small stretch in human history - but forever. And that just speaks to his competitive stamina and love of the game.”James’s longevity allowed him to achieve a cherished dream this season, playing alongside son Bronny James as they became the first father-son duo to play together in a regular-season game.The Lakers’ decision to draft the largely untried Bronny James -whose collegiate career was disrupted by a frightening heart attack that revealed a congenital heart defect - sparked backlash.But James said in September that the chance to play alongside his son, and his role in helping the United States defend their Olympic title in Paris, had reinvigorated him.“Gives you a lot of life,” James said, and that’s surely just what the Lakers wanted to hear from the player who signed a new two-year contract worth a reported $100mn in July.Whether he’ll go on that long remains to be seen. James’s interests off the court are constantly expanding. As a partner in the Fenway Sports Group that owns Liverpool FC, James has shares in the English Premiership club as well as Major League Baseball’s Boston Red Sox and the National Hockey League’s Pittsburgh Penguins.His entertainment firm the SpringHill Company has made him a player in Hollywood and Forbes estimates that James is the first basketball player to become a billionaire ($1.2bn) during his career.When his playing days are over, James has said, he wants to become an NBA owner, preferably in Las Vegas. But first there’s the pursuit of a fifth title.James won back-to-back titles with the Miami Heat in 2012 and 2013, then returned to his hometown Cleveland Cavaliers and led them to the crown in 2016.But he hasn’t won a ring since 2020, when the Lakers triumphed in the league’s “Covid bubble” in Orlando.The Lakers have since been disappointing, reaching the Western Conference Finals in 2023, but being eliminated in the first round of the play-offs last spring.They have struggled to build momentum this season and James looked his age as he battled through a shooting slump that saw him miss all 19 of his three-point attempts in one four-game stretch. He has also missed games with a foot injury and illness and seen his points in the paint and efficiency in transition diminish. But James delivered a classic on Christmas Day, scoring 31 points and handing out 10 assists as the Lakers edged the Golden State Warriors.Redick sounds in awe of James’s ability to keep rising to the demands of the game.“For guys like him ... the Tom Bradys of the world, the Roger Federers of the world, it’s hard to comprehend having that level of sustained excellence for so long because of the toll that it takes on all of you, not just on your body.”

China revised upwards yesterday the size of its economy by 2.7%, but said the change would have little impact on growth this year, as policymakers pledged more stimulus to spur expansion in 2025.Policy support late this year has set the world’s second-largest economy on track for a growth target of “around 5%” as activity warmed slightly, but challenges such as potential US tariff hikes still weigh on prospects for next year.Gross domestic product (GDP) in 2023 was raised by 3.4tn yuan to 129.4tn ($17.73tn), Kang Yi, the head of the National Bureau of Statistics, told a press conference, while releasing the fifth national economic census.He did not explain the reasons for the 2023 revision, but said the bureau would provide further details on its website within days.China’s economy has “withstood the test of multiple internal and external risks over the past five years, and maintained a generally stable trend while progressing,” Kang said.In previous five-yearly economic censuses, China revised up the size of the economy for 2018 by 2.1% and for 2013 by 3.4%.The fifth economic census carried out over the past five years encompassed the three years of the Covid-19 pandemic, which had a significant impact on the economy, Kang added. The international environment had witnessed “profound and complex changes” since the previous such census, he said.The revision of 2023 GDP would not have a significant impact on China’s 2024 GDP growth rate, Lin Tao, the bureau’s deputy head, told the same briefing, however.On Thursday, the World Bank raised its forecast for China’s economic growth in 2024 and 2025, but warned that subdued household and business confidence, along with headwinds in the property sector, would keep weighing it down next year.The economic census will provide important data to help formulate tasks for China’s 15th five-year plan from 2026-2030, and help achieve its 2035 goals, Kang said, without elaborating.President Xi Jinping’s vision of “Chinese-style modernisation” envisages doubling the size of the economy by 2035 from its 2020 level.Government economists estimate that would require average annual growth of 4.7%, a target many analysts outside China consider overly ambitious.At an agenda-setting meeting this month, Chinese leaders pledged to increase the budget deficit, issue more debt and loosen monetary policy to support economic growth next year in expectation of more trade tensions with the US when President-elect Donald Trump takes office in January.Last week Reuters reported that the leaders agreed to raise the budget deficit to 4% of gross domestic product next year, its highest on record, while maintaining an economic growth target of around 5%.The economic census showed the number of business entities in the secondary and tertiary industries at the end of 2023 rose 52.7% from the end of 2018, but growth of employment lagged, at 11.9%.The economic census showed changes in China’s job market, with 25.6% more people employed in the tertiary industries at the end of 2023 than at the end of 2018, but secondary industries had 4.8% fewer employees.As a severe property crisis hobbles a macroeconomic rebound, employees of property developers fell 27% to 2.71mn by the end of 2023 against the corresponding 2018 figure, the economic census data showed.

The United Kingdom’s Labour government has given serious thought to the public investment needed to get the economy back on track after 14 years of austerity, neglect of social infrastructure, and capital flight triggered by Brexit and uncertain economic conditions. It understands that the situation demands a new strategy to tackle big problems like child poverty, health inequities, a weak industrial base, and struggling public infrastructure.What should this look like? The UK Department for Business and Trade’s recent industrial strategy “green paper”, Invest 2035, is a promising start. However, in my own response during the public consultation period, I stressed that an industrial strategy should be oriented around key “missions” like achieving net-zero emissions, rather than around specific sectors, as the government appears to be doing. While the government has set itself five “missions”, they seem more like goals with some targets, rather than being central to the way government and industry work together.For Labour to deliver on its agenda, it must get its public-private partnerships right. Historically, public-private collaborations in the UK have involved the state overpaying and the private sector underdelivering. Following the Brexit referendum, for example, the government secretly gave Nissan £61mn ($76mn) to build new cars in the UK. But Nissan still abandoned a planned expansion at its Sunderland plant, and the promised jobs never materialised.Likewise, under the failed “private finance initiative” schemes of the 1990s, the state would pay inflated sums to private contractors to operate public services such as prisons, schools, and hospitals before handing them back to the state, often in poor condition and without any clear improvement to the service. This approach was widely used in the construction of National Health Service hospitals, with the first 15 contracts generating £45mn in fees – some 4% of the capital value of the deals – for advisers across the public and private sector. A UK Treasury analysis later showed that the general costs of PFIs were double that of government borrowing.Fortunately, many public-private partnerships globally have produced more positive results. Germany’s national development bank, KfW, offers low-interest loans to companies that agree to decarbonise. Similarly, the French government’s Covid-19 bailout of Air France was conditional on the carrier curbing emissions per passenger and reducing domestic flights; by contrast, the UK bailed out easyJet with no strings attached.In the US, the CHIPS and Science Act required companies that benefit from public funds to commit to climate and workforce development plans, provide childcare, and pay a living wage. Preference is also given to companies that reinvest profits instead of using share buybacks.The UK does have some experience in shaping markets around clear goals. In developing the Oxford/AstraZeneca Covid-19 vaccine, the government used a risk- and reward-sharing model in which it provided 95% of the funding in exchange for certain commitments from the company. AstraZeneca would provide the first 100mn doses to the UK and allow the government to donate and reassign surplus vaccines.Similarly, Octopus Energy’s acquisition of energy supplier Bulb allowed the UK government to reap £1.5bn in profit as Octopus repaid the public support it had received through an earlier profit-sharing deal. This agreement safeguarded jobs and prevented consumers from incurring any extra costs.With a mission-oriented strategy, the Labour government could scale up and systematise this type of public-private engagement. Rather than being “unreservedly pro-business,” as it claims to be in its green paper, it should ensure that public investment targets clear objectives: to crowd in private capital, create new markets, and increase long-term competitiveness.Consider the UK’s net-zero-emissions target, which is not only about clean power but also about how we eat, move, and build. The state has a crucial role to play as a first-mover, shaping markets so that private incentives are aligned with public goals. Yet judged by this standard, recent moves by the Labour government appear to fall short.For example, Prime Minister Keir Starmer’s deals with Macquarie (an investment bank), Blackstone (asset management), and others raised more than £60bn without setting clear, outcomes-oriented expectations or ensuring that both risks and rewards are shared. Equally, the government’s support of carbon capture and storage (to the tune of £22bn so far) allows funds to flow to incumbent oil giants without holding them accountable in the green transition.These deals are structured to achieve growth at any cost, when what the UK really needs is growth that is inclusive and sustainable. That requires better corporate governance to prevent situations like Thames Water (a water and waste utility) being saddled with over £2bn in debt after Macquarie became a major shareholder in 2006.As I’ve said before, growth itself is not a mission; it is the result of public and private investment, and good growth is a result of directed investment. If the UK’s climate transition is going to deliver for people and planet over the long term, the government’s engagement with the private sector must reflect confidence, not capitulation. This can start by deploying tools that the government already has. The new National Wealth Fund and Great British Energy (a publicly owned clean-energy company that is expected to launch early next year) could make a huge difference, but only if policymakers get the implementation right.For example, the National Wealth Fund should introduce conditionalities for public investments; provide public access to intellectual property and patents for research; create subsidies and other incentives for mission-aligned investments; and use loan guarantees and bailouts to move companies toward decarbonisation, improved working conditions, and fewer share buybacks. Procurement is also a strong lever, because it represents one-third of the government’s total spending and can direct investment toward strategically important goals.Ultimately, the UK government must shift from a sectoral approach to a mission-oriented one that embraces a confident, outcomes-oriented form of public-private partnership, incentivising the private sector to do its part. Labour understands the problem, but its proposed solution still needs some work. – Project SyndicateMariana Mazzucato is Professor in the Economics of Innovation and Public Value at University College London and author, most recently, of Mission Economy: A Moonshot Guide to Changing Capitalism (Penguin Books, 2022).

While official sources and the media highlight strong consumer-spending and jobs data in the US, or tout high US stock-market valuations, more than three-quarters of Americans view economic conditions as poor (36%) or fair (41%). This disconnect between performance and perception can have far-reaching consequences; it already helped to propel Donald Trump to victory in last month’s presidential election. So, what is causing it?Here, it is worth considering how market participants deal with asymmetric information – when one party has more or better information than another party or parties. Imagine you were seeking to make a purchase. As a buyer, there is a limit to the information you can glean about your options through direct observation. So, you make your decision based on your beliefs about those options, which extend beyond discernible facts to include unseen or anticipated characteristics.But the process is not finished when the transaction is complete. You then engage in “discovery” – essentially, observation. If, during this process, you learn things that do not correspond with the beliefs that drove your decision, you modify your beliefs.In the signalling and screening models that economists use, the choices made by a variety of agents close information gaps and lead to equilibrium: the beliefs shaping demand lead to choices on the supply side that turn out to be consistent with those beliefs. The crucial point is that the direct observation that follows a transaction anchors beliefs and determines equilibrium.But in our highly complex economy, characterised by specialisation and interconnectedness, such observation is not always possible. On the contrary, many or even most of the conditions that are salient for an individual’s well-being or decision-making today are not local or subject to personal observation. There can be no comprehensive discovery process ensuring that beliefs are linked to underlying realities.Where personal verification is impractical or impossible, we rely on informational intermediaries, including the traditional media, government, or experts, such as climate scientists. In our digital age, social-media platforms and online sources have also claimed a prominent position in our information ecosystems.But if these intermediaries are to close information gaps, they must be trustworthy – and Americans are not convinced that they are. A 2023 Gallup poll showed that faith in institutions, from media to government, had reached historic lows in the US, with only 18% of respondents expressing confidence in newspapers, 14% in television news, and 8% in Congress. Scientists fare better, with 76% of Americans reporting a “great deal” or “fair amount” of confidence that they will act in the public’s best interests, though the group that identifies as “highly sceptical” is growing, especially among self-reported Republicans.Why don’t Americans trust the institutions that are supposed to be helping to close information gaps? Rosy news about the economy’s performance that fails to account for people’s pocketbook realities might be part of the answer.Income-distribution data can help shed light on these realities. The 2008 global financial crisis – which began with the collapse of a housing bubble – dealt a major blow to the balance sheets of the bottom 50% of households. In 2010, this group accounted for just 0.7% of total household net worth. A partial recovery followed, but the Covid-19 pandemic and subsequent surge in inflation, which spurred the US Federal Reserve to raise interest rates, produced new headwinds. More than a quarter of US households now spend more than 95% of their income on necessities, leaving them vulnerable to even mild shocks and making wealth-building all but impossible.This year, total US household net worth stood at $154tn, with the bottom 50% of the distribution accounting for $3.8tn – just 2.5% of the total. That works out to $58,000, on average, for some 66mn US households, with many owning much less. The top 10% hold two-thirds of all US household wealth, and the bottom 90% share the remaining one-third.It is not difficult to understand why Americans might be mistrustful of those delivering a rosy economic narrative that does not correspond with their experience. Even when media outlets do highlight the challenging economic conditions many Americans face, their reports are not translated into policies and actions that make a significant difference. This has been true for at least two decades, and undermines confidence in the system as a whole. At a certain point, people may start assuming that traditional institutions are either lying or clueless.The de-anchoring of beliefs from traditional sources of information leaves the field wide open for alternatives, which may well be unreliable. The Internet – and social media, in particular – both facilitates and complicates this process, as it delivers access to vast numbers of unverified sources. The results can be highly polarizing.While research into social media’s impact on our behaviour is ongoing, it seems clear that platforms like Facebook, X, and TikTok have become powerful mechanisms for group formation. The process is self-reinforcing: individuals select their group based partly on shared beliefs, and the group influences members’ perspectives. Confirmation bias – the tendency to seek information that is consistent with one’s prior beliefs – reinforces groups’ diverging perceptions of reality. Some controversial beliefs – such as the claim that the 2020 presidential election was stolen from Donald Trump – are not actually beliefs for many, but rather screening devices to verify group members’ allegiance to the same “facts”.Against this backdrop, restoring a shared baseline perception of reality as a foundation for economic policy amounts to a formidable task. Americans’ sharply divergent economic experiences, rooted in soaring wealth inequality and many other hardships, including the rising costs of health care and college, will only compound the challenge. – Project SyndicateMichael Spence, a Nobel laureate in economics, is Emeritus Professor of Economics and a former dean of the Graduate School of Business at Stanford University and a co-author (with Mohamed A El-Erian, Gordon Brown, and Reid Lidow) of Permacrisis: A Plan to Fix a Fractured World (Simon & Schuster, 2023).

Thousands of selfie-taking Ho Chi Minh City residents crammed into train carriages yesterday as the traffic-clogged business hub celebrated the opening of its first-ever metro line after years of delays.Huge queues spilled out of every station along the $1.7bn line that runs almost 20km from the city centre - with women in traditional “ao dai” dress, soldiers in uniform and couples clutching young children waiting excitedly to board.“I know it (the project) is late, but I still feel so very honoured and proud to be among the first on this metro,” said office worker Nguyen Nhu Huyen after snatching a selfie in her jam-packed train car.“Our city is now on par with the other big cities of the world,” she said.It took 17 years for Vietnam’s commercial capital to reach this point. The project, funded largely by Japanese government loans, was first approved in 2007 and slated to cost just $668mn.When construction began in 2012, authorities promised the line would be up and running in just five years.But as delays mounted, cars and motorbikes multiplied in the city of 9mn people, making the metropolis hugely congested, increasingly polluted and time-consuming to navigate.The metro “meets the growing travel needs of residents and contributes to reducing traffic congestion and environmental pollution”, the city’s deputy mayor Bui Xuan Cuong said.Cuong admitted authorities had to overcome “countless hurdles” to get the project over the line.According to state media reports, the metro was late because of “slow capital disbursement, unexpected technical problems, personnel difficulties and the Covid-19 pandemic”.“The delays and cost overruns have been frustrating,” said professor Vu Minh Hoang at Fulbright University Vietnam, who warned that with just 14 station stops, the line’s “impact in alleviating traffic will be limited in the short run”.However, it is still a “historic achievement for the city’s urban development”, he added.With lessons learnt, “the construction of future lines will be increasingly easier, faster, and more cost-efficient”, Hoang said.Back on the train, 84-year-old war veteran Vu Thanh said he was happy to experience below ground in a more positive way after spending three years fighting American troops in the city’s famous Cu Chi tunnels, an enormous underground network.“It feels so different from the underground experience I had years ago during the war. It’s so bright and nice here,” he said.Reflecting on the delays, he added: “We built the tunnels to hide from our enemies in the past, so building a tunnel for a train should not be that hard,” he added. “Finally, we made it!”

Companies that spent billions on poorly timed acquisitions in recent years are now offloading those assets at knockdown prices.Alibaba Group Holding Ltd announced on Tuesday it’s going to sell Chinese department-store chain Intime to a local apparel group for $1bn. The price is around 30% of the company’s valuation when Alibaba bought it during the heady days of 2017. The Internet giant, which has largely abandoned its acquisitive ways amid government pressure, said it will book a $1.3bn loss on the transaction.The deal came a day after BlackBerry Ltd said it would divest its Cylance endpoint security unit to software startup Arctic Wolf for $160mn plus a small amount of stock. That’s a far cry from the $1.4bn BlackBerry paid when it agreed to buy the business in 2018. Under BlackBerry’s ownership, Cylance reported substantial losses and its revenue fell over 50%, according to Royal Bank of Canada analysts.The moves show how companies that were major acquirers during the boom times may sober up and regret those purchases only a few years later. Just last month, Just Eat Takeaway.com NV agreed to sell US food delivery service Grubhub for $650mn, a roughly 90% discount to the price it paid to buy the business at the height of the Covid pandemic.Overpayment was the inevitable byproduct of an era when competition for assets was fierce, according to Oliver Scharping, a portfolio manager at Berenberg.“Years of zero interest rates and pandemic-fuelled deal hysteria sent valuations soaring in hype sectors, often detached from fundamentals,” Scharping said. “Now, as the zeitgeist demands a sober look in the mirror, companies are trimming excess, dumping underperformers, and opting for brutal honesty over sunk-cost fantasy — even if it means a multibillion-dollar haircut.” Valeriya Vitkova, a senior lecturer at City University of London’s Bayes Business School, said that companies didn’t properly assess synergies and the expected benefits of some deals were overestimated.Now may be a good time to find buyers for these assets as the M&A market has become active again, Vitkova said. Overall M&A volumes have risen 16% this year to $3.2tn, according to data compiled by Bloomberg, and bankers expect the pace to pick up next year.These divestments allow the companies to focus on shoring up their main operations at a pivotal time. Alibaba has been working to reignite growth in its Chinese e-commerce division, where it faces fierce competition from PDD Holdings Inc and ByteDance Ltd.Meanwhile, BlackBerry Chief Executive Officer John Giamatteo is trying to turn around the company by devoting more attention to its Internet of Things business as well as its secure communications platforms.A representative for Just Eat Takeaway said the market has changed since it bought Grubhub, with competition increasing and sector valuations falling. The sale to Wonder Group Inc represents the “most attractive outcome” and “reflects the current trajectory of the business,” the representative said. Alibaba didn’t immediately respond to queries.A spokesperson for BlackBerry said it’s “incredibly pleased” with the outcome for Cylance, which will help profitability and let it focus on the growth engines in its portfolio. Investors seem happy too, with BlackBerry shares jumping 15% the day the deal was announced, the biggest gain since August 2023.Companies will continue to pursue divestments of acquisitions that didn’t work out, as markets are rewarding focus and punishing bloated firms, Berenberg’s Scharping said. That could provide good opportunities for cash-rich corporate buyers looking for bargains, as well as private equity firms that Bloomberg-compiled data show are sitting on $1.6tn of dry powder.“The pricing reset has reopened the gates for disciplined buyers to act,” Scharping said. “We’re seeing opportunists leverage cleaner balance sheets and tighter focus to pick up discounted assets with long-term upside.”

Federal Reserve officials lowered their benchmark interest rate for a third consecutive time, but reined in the number of cuts they expect in 2025, signalling greater caution over how quickly they can continue reducing borrowing costs.The Federal Open Market Committee voted 11-1 yesterday to cut the federal funds rate to a range of 4.25%-4.5%. Cleveland Fed President Beth Hammack voted against the action, preferring to hold rates steady.New quarterly forecasts showed several officials pencilled in fewer rate cuts for next year than they estimated just a few months ago. They now see their benchmark rate reaching a range of 3.75% to 4% by the end of 2025, implying two quarter-percentage-point cuts, according to the median estimate.Only five officials indicated a preference for more reductions next year.A majority of economists in a Bloomberg survey had expected the median rate estimate would point to three cuts next year.Policymakers also made a subtle adjustment to the language of the statement released after their meeting, saying they would assess several factors “in considering the extent and timing of additional adjustments” to the policy rate.Previously, they merely said “in considering additional adjustments.”The S&P 500 index fell following the announcement, while US Treasury yields and the Bloomberg Dollar Index rose.Policymakers have now lowered their benchmark lending rate by a full percentage point since mid-September, when they began cuts with an aggressive half-point move. At the time, they were encouraged by falling inflation and worried the labour market was approaching a dangerous tipping point. Since then, the landscape has shifted. The labour market has proved resilient, with payrolls growing by an average 173,000 over the last three months. The unemployment rate ticked up to 4.2% in November, but remains low by historical standards. Powell said earlier this month that downside risks to the labour market appear to have receded.Policymakers now see the unemployment rate 4.3% in 2025, updated projections show. They also slightly raised their forecast for economic growth in 2025 to 2.1%. Meanwhile, recent price data has raised concerns that inflation may be stalling above the Fed’s 2% target, prompting a number of Fed officials to say they’d prefer to slow the pace of cuts.Some have done so while voicing confidence that inflation will continue to decline, pointing to factors such as an anticipated slowdown in housing costs.Others, like Fed Governor Michelle Bowman, have emphasised that inflation remains uncomfortably above the Fed’s goal.The median projection for inflation at the end of next year jumped to 2.5%, from 2.1% in September.Officials again raised their median estimate of where the policy rate will settle over the long run to 3% from 2.9%.Officials have said there is substantial uncertainty over where that so-called neutral rate, which neither promotes nor inhibits economic activity, lies following the Covid-19 pandemic.Some have suggested the neutral rate has moved higher, meaning officials can reach it with fewer cuts than previously anticipated.President-elect Donald Trump’s proposed policies on trade, immigration and taxation add another element of uncertainty to the inflation outlook. Depending on how they are structured, those could put upward pressure on inflation and constrain the labour market, according to some estimates. Powell has said the Fed is modelling and evaluating Trump’s proposals, but not yet incorporating them into decisions because it’s unclear what specific form the policies will take.