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Aura Private Credit: Letter to investors 25 November 2022

This week, Governor Philip Lowe gave an address on inflation in a rapidly evolving economic environment. ​ RBA speech on price stability, the supply…

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This week, Governor Philip Lowe gave an address on inflation in a rapidly evolving economic environment.

RBA speech on price stability, the supply side and prosperity1

​In this week’s address, the Governor’s key topic was inflation. Despite the shock of recent inflation figures, the RBA is looking to assure us that the current high inflationary environment is only temporary and that the policy decisions being made are necessary in order to rein in inflation. ​

​History has shown that a persistent inflationary environment can cause costly damage to the  economy, labour market and general living standards. As such, central banks are using their learnings from the 1970s and 1980s – when inflation peaked at 17.7 per cent and 12.4 per cent respectively – to avoid history repeating itself and attempt to ensure that inflation is short lived. This is the reason for the RBA’s recent rapid monetary policy decisions which have been implemented well before their previously communicated 2024 timeline. ​

The RBA’s central forecast has inflation peaking at 8 per cent later this year, before gradually declining over the next couple of years and sitting slightly above 3 per cent by the end of 2024. ​

The predicted decline in inflation is based off various factors, including:​

  • Resolution of supply side issues brought about by COVID-19 disruptions – delivery times and shipping costs have begun to decline;​
  • Stabilisation of commodity prices – this has already occurred, although geopolitical tensions abroad and the recent flood events back home may lead to some pressures; and​
  • Rising interest rates – the overall aim is to reduce demand pressure, which will essentially slow growth, and pricing pressures. ​

The market’s reaction to the anti-inflationary measures put in place is not guaranteed. Ongoing shifts are possible given the unpredictability of future disruptions. We are now seeing adverse climate events and geopolitical issues occur more frequently. As the Governor warned, “life is more complicated in a world of supply shocks; an adverse supply shock increases inflation and reduces output and employment.”

Several supply-side developments will affect the environment for Australian businesses over the years ahead, creating greater volatility in inflation.

  • International trade is no longer growing faster than the global economy. With added barriers to trade and investment likely to persist, this will continue to affect living standards and the price of goods and services.
  • The declining working age population is projected to accelerate, with an increase in the ratio of younger and older people in the population.
  • More frequent extreme weather and climate events causing disruption to the supply chain, creating pricing pressures.

The post-Covid environment has introduced new enduring challenges for the economic environment. Current developments that affect the rate of inflation are increasingly complex when compared to historically high inflationary periods. Constant barriers to supply and demand caused by shifts in migration, relatively slow wage growth, widely adopted hybrid work, geopolitical tensions particularly the Ukraine war and persistent lockdowns in China to name a few; all contribute to the measure of inflation and influence the effectiveness of central bank intervention.

The Governor has acknowledged that unfortunately barriers to trade and investment are more likely to be increased than removed, creating greater disparity in the affects on living standards and pricing of goods and services. As such, the RBA has flagged the idea that increased variability in inflation may be the new norm and may cause a shift in the way in which monetary policy decisions are made. The target 2-3 per cent inflationary range may be something for the RBA to re-evaluate.

The RBA has a difficult mandate in this environment. The Governor acknowledged that “higher inflation calls for higher interest rates but lower output, and fewer jobs calls for lower interest rates. It is likely that we will have to deal with this tension more frequently in the future.” They face the prospect of pushing too hard and overshooting, given the mismatch in the tight labour market and rate at which real wages are growing.

1Reserve Bank of Australia – Price Stability, the Supply Side and Prosperity Speech

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First-ever social responsibility report of Chinese enterprises in Saudi Arabia incorporates BGI Genomics projects

On December 1, 2022, the Social Responsibility Report of Chinese Companies in Saudi Arabia was officially launched, which is the first such report released…

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On December 1, 2022, the Social Responsibility Report of Chinese Companies in Saudi Arabia was officially launched, which is the first such report released by the Contact Office of Chinese Companies in Saudi Arabia. BGI Genomics projects in the Kingdom have been incorporated into this report.

Credit: BGI Genomics

On December 1, 2022, the Social Responsibility Report of Chinese Companies in Saudi Arabia was officially launched, which is the first such report released by the Contact Office of Chinese Companies in Saudi Arabia. BGI Genomics projects in the Kingdom have been incorporated into this report.

This event was attended by around 150 representatives of Chinese and Saudi enterprises, Saudi government officials, experts in the field of sustainable development, CCTV, Xinhua News Agency, Saudi Press Agency, Arab News and other media professionals. This Report presents the key projects and best practices of Chinese enterprises to fulfil their social and environmental responsibilities while advancing the Kingdom’s industry development.

Chen Weiqing, the Chinese ambassador to Saudi Arabia, said in his video speech that the Report highlighted Chinese enterprises’ best practices in serving the local community, safe production, green and low-carbon development and promoting local employment. The release of the Report helps Chinese enterprises in the Kingdom to strengthen communication with the local community, laying a stronger foundation for future collaboration.

Epidemic control and accelerating post-COVID 19 recovery

BGI Genomics has been fulfilling its corporate social responsibilities and worked with the Saudi people to fight the COVID-19 epidemic.

In March 2020, Saudi Arabia was hit by the pandemic. The Saudi government decided to adopt BGI Genomics’ Huo-Yan laboratory solution in April 2020. At the forefront of the fight against the epidemic, the company has built six laboratories in Riyadh, Makkah, Madinah, Dammam and Asir within two months, with a total area of nearly 5,000 square meters and a maximum daily testing throughput of 50,000 samples.

By the end of December 2021, BGI Genomics had sent 14 groups of experts, engineers and laboratory technicians to Saudi Arabia, amounting to over 700 people, and tested more than 16 million virus samples, accounting for more than half of the tests conducted during this period. The company has successfully trained over 400 qualified Saudi technicians, and all laboratories have been transferred to local authorities for the operation.

In the post-epidemic era, the Huo-Yan laboratories can continue to make positive contributions to public health, working with local medical institutions and the public health system to make breakthroughs in areas such as reproductive health, tumour prevention and control, and prevention.

Enhancing genomic technology localization and testing capabilities

In July 2022, BGI Almanahil and Tibbiyah Holdings, a wholly owned subsidiary of the Saudi Faisaliah Group, announced a joint venture (JV) to establish an integrated, trans-omics medical testing company specializing in genetic testing.

This JV company will help improve Saudi Arabia’s local clinical and public health testing and manufacturing capabilities, promote the localization of strategic products that have long been imported, contribute to the implementation and realization of the Kingdom’s Vision 2030 roadmap, and significantly enhance local capacity for third-party medical testing services as well as local production of critical medical supplies.

BGI Genomics attaches great importance to fulfilling its corporate social responsibility and has released its social responsibility report for four consecutive years since 2017. Since its establishment, the company has always been guided by the goal of enhancing health outcomes for all, relying on its autonomous multi-omics platform to accelerate technological innovation, promote reproductive health, strengthen tumour prevention and control, and accurately cure infections, and is committed to becoming a global leader in precision medicine and covering the entire public health industry chain.

The company will continue to work together with all stakeholders to contribute to the Kingdom’s Vision 2030 and the Belt and Road Initiative and looks forward to growing with our partners.

 

About BGI Genomics

BGI Genomics, headquartered in Shenzhen China, is the world’s leading integrated solutions provider of precision medicine. Our services cover over 100 countries and regions, involving more than 2,300 medical institutions. In July 2017, as a subsidiary of BGI Group, BGI Genomics (300676.SZ) was officially listed on the Shenzhen Stock Exchange.

 


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Alcohol deaths in the UK rose to record level in 2021

Nearly 10,000 people died from alcohol in 2021.

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Deaths from alcohol in the UK have risen to their highest level since records began in 2001, according to the latest data from the Office for National Statistics (ONS). In 2021, 9,641 people (14.8 per 100,000) died as a result of alcohol: a rise of 7.4% from 2020.

The leading cause of alcohol-specific deaths (deaths caused by diseases known to be a direct consequence of alcohol) continues to be liver disease. More than three-quarters (78%) of all alcohol deaths in 2021 were attributed to this cause. The remainder of the deaths were due to “mental and behavioural disorders because of the use of alcohol” and “accidental poisoning by, and exposure to, alcohol”.

Although there is no such thing as a safe level of drinking, and many people would feel the health benefits of reducing consumption, most of the risks of developing health problems and dying are skewed towards those who drink the most.

Between 2012 and 2019 alcohol-specific deaths remained relatively stable. It is no coincidence that deaths rose sharply during the first two years of the pandemic: those that were already drinking at harmful levels increased their consumption further during this period. Although liver disease can take years to develop, this process is accelerated when those drinking at harmful levels increase their consumption further.

Other statistics show that unplanned alcohol-related hospital admissions decreased during this period, which may have meant missed opportunities to provide help for those people experiencing problems with alcohol.

Looking beyond the headline figures, there are important differences in various groups within the population. Alcohol-specific deaths were not spread equally. For example, men were twice as likely to die as women. In 2021, 20.1 men per 100,000 died compared with 9.9 women.

Where you live in the UK matters, too, as deaths in Scotland are the highest, followed by Northern Ireland, Wales then and England – although the gap between the nations seems to be narrowing.

In England, deaths are highest in the north-east of England (20.4 per 100,000), which is twice as high as those in London (10.2 per 100,000). Although rates have increased in all regions; for example, there was a rise of 38% in south-west England from 2019 to 2021. This reflects what is already known about the relationship between deprivation and harm from alcohol. There is a two to fivefold higher risk of dying among lower-income groups compared with those from the higher-income groups.

Reflecting the growing trend of young people drinking less than older age groups, it is those aged 50 to 64 that account for most deaths due to liver disease. In 2021, for example, 39 people aged 25 to 29 died from alcohol-related liver disease, compared with 1,326 of those aged 50 to 59. This is related to a greater number of years of drinking but is also a general reflection that when older adults were younger, they tended to drink more than younger people do now.

Numbers of alcohol-specific deaths, by five-year age group and individual cause. Office for National Statistics – Alcohol-specific deaths in the UK: registered in 2021, National Records of Scotland and the Northern Ireland Statistics and Research Agency

Addressing harms

So what can be done to begin to address alcohol harms? It has been estimated that almost a quarter of drinkers in the UK drink above the recommended low-risk drinking guidelines. So this is a health and social issue that requires a national response. Low-impact initiatives, such as education and awareness raising, may not be enough.

The costs of alcohol to society are significant. A recent review estimated this to be £27 billion annually, with only half of this offset by tax revenue on alcohol products.

Timely access to specialist treatment can help to reduce the health risks associated with alcohol. Unfortunately, there have been significant cuts to funding for this type of intervention.

Around 80% of people classed as dependent on alcohol in England are not currently getting treatment support. While there has recently been extra funding for drug services to try and correct historic cuts, this has not been extended to alcohol. Reversing this by investing in services could help to reduce the rising number dying prematurely from alcohol.

A new strategy is long overdue

The last government strategy for alcohol was published in 2012, so there is a pressing need for a new one. This must address all the ways that the harms from alcohol can be tackled, from marketing and pricing to specialist treatment and recovery services.

A group, led by Liverpool MP Dan Carden, with cross-party support, recently called on the government to initiate an independent review of alcohol harm, along the lines of the review led by Dame Carol Black, which had a significant influence on drug policy and treatment funding.

Without such a review and strategy based on it, the harms caused by alcohol including premature death will continue to rise year after year. So much has changed since the last alcohol strategy in 2012 not least the current cost of living crisis. The outlook for investment in public health looks bleak, added to which this government doesn’t seem willing to curtail the efforts of the alcohol industry in marketing and protecting its products.

Harry Sumnall receives and has received funding from grant awarding bodies for alcohol and other drug research. He sits on grant-awarding funding panels, and is an unpaid scientific adviser to the MIND Foundation.

Ian Hamilton does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.

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Alcohol deaths in the UK rose to record levels in 2021

Nearly 10,000 people died from alcohol in 2021.

Published

on

By

There has been a record rise in deaths from alcohol in the UK, according to the latest data from the Office for National Statistics (ONS). In 2021, 9,641 people died as a result of alcohol: a rise of 7.4% from 2020.

The leading cause of alcohol-specific deaths (deaths caused by diseases known to be a direct consequence of alcohol) continues to be liver disease. More than three-quarters (78%) of all alcohol deaths in 2021 were attributed to this cause. The remainder of the deaths were due to “mental and behavioural disorders because of the use of alcohol” and “accidental poisoning by, and exposure to, alcohol”.

Although there is no such thing as a safe level of drinking, and many people would feel the health benefits of reducing consumption, most of the risks of developing health problems and dying are skewed towards those who drink the most.

Between 2012 and 2019 alcohol-specific deaths remained relatively stable. It is no coincidence that deaths rose sharply during the first two years of the pandemic: those that were already drinking at harmful levels increased their consumption further during this period. Although liver disease can take years to develop, this process is accelerated when those drinking at harmful levels increase their consumption further.

Other statistics show that unplanned alcohol-related hospital admissions decreased during this period, which may have meant missed opportunities to provide help for those people experiencing problems with alcohol.

Looking beyond the headline figures, there are important differences in various groups within the population. Alcohol-specific deaths were not spread equally. For example, men were twice as likely to die as women. In 2021, 20.1 men per 100,000 died compared with 9.9 women.

Where you live in the UK matters, too, as deaths in Scotland are the highest, followed by Northern Ireland, Wales then and England – although the gap between the nations seems to be narrowing.

In England, deaths are highest in the north-east of England (20.4 per 100,000), which is twice as high as those in London (10.2 per 100,000). Although rates have increased in all regions; for example, there was a rise of 38% in south-west England from 2019 to 2021. This reflects what is already known about the relationship between deprivation and harm from alcohol. There is a two to fivefold higher risk of dying among lower-income groups compared with those from the higher-income groups.

Reflecting the growing trend of young people drinking less than older age groups, it is those aged 50 to 64 that account for most deaths due to liver disease. In 2021, for example, 39 people aged 25 to 29 died from alcohol-related liver disease, compared with 1,326 of those aged 50 to 59. This is related to a greater number of years of drinking but is also a general reflection that when older adults were younger, they tended to drink more than younger people do now.

Numbers of alcohol-specific deaths, by five-year age group and individual cause. Office for National Statistics – Alcohol-specific deaths in the UK: registered in 2021, National Records of Scotland and the Northern Ireland Statistics and Research Agency

Addressing harms

So what can be done to begin to address alcohol harms? It has been estimated that almost a quarter of drinkers in the UK drink above the recommended low-risk drinking guidelines. So this is a health and social issue that requires a national response. Low-impact initiatives, such as education and awareness raising, may not be enough.

The costs of alcohol to society are significant. A recent review estimated this to be £27 billion annually, with only half of this offset by tax revenue on alcohol products.

Timely access to specialist treatment can help to reduce the health risks associated with alcohol. Unfortunately, there have been significant cuts to funding for this type of intervention.

Around 80% of people classed as dependent on alcohol in England are not currently getting treatment support. While there has recently been extra funding for drug services to try and correct historic cuts, this has not been extended to alcohol. Reversing this by investing in services could help to reduce the rising number dying prematurely from alcohol.

A new strategy is long overdue

The last government strategy for alcohol was published in 2012, so there is a pressing need for a new one. This must address all the ways that the harms from alcohol can be tackled, from marketing and pricing to specialist treatment and recovery services.

A group, led by Liverpool MP Dan Carden, with cross-party support, recently called on the government to initiate an independent review of alcohol harm, along the lines of the review led by Dame Carol Black, which had a significant influence on drug policy and treatment funding.

Without such a review and strategy based on it, the harms caused by alcohol including premature death will continue to rise year after year. So much has changed since the last alcohol strategy in 2012 not least the current cost of living crisis. The outlook for investment in public health looks bleak, added to which this government doesn’t seem willing to curtail the efforts of the alcohol industry in marketing and protecting its products.

Harry Sumnall receives and has received funding from grant awarding bodies for alcohol and other drug research. He sits on grant-awarding funding panels, and is an unpaid scientific adviser to the MIND Foundation.

Ian Hamilton does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.

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