As outlined in Deloitte’s paper “2010 FIFA World Cup. A Turning Point for South Africa,” South Africa is reaping the rewards of hosting the Cup, including infrastructure improvements, an economic boost, and an increase of national pride.

“South Africa has been likened to a mix of the developed and developing world,” said Lwazi Bam, Public Sector Industry Leader, Deloitte Southern Africa. “On the one hand, a strong technological and economic base put it on a par with the well-developed nations of the world. On the other, infrastructure shortfalls have contributed to keeping it from realizing its full economic potential. This major global event is a catalyst for much-needed infrastructure improvements.”

The need to move tens of thousands of fans, teams, and accompanying supportpersonnel rapidly from one place to another prioritized the strengthening of South Africa’s transportation system.  The country completed much of the
first section of its new high speed Gautrain passenger railway and added bus lines.  Highways were upgraded and the city of Durban was able to finish the country’s first new green field airport in five decades.  These infrastructure projects have increased employment opportunities and provided workers long-term skills and training.

One of the challenges in building the infrastructure for the event was generating power without an unduly adverse environmental impact. New stadium facilities include such environmentally-friendly features as natural ventilation and rain water capture systems.

In addition, host cities have undertaken large-scale tree-planting projects in an effort to soak up excess carbon dioxide.  As a coal-dependent economy, South African faces challenges; however, these steps move the country toward greener energy sources.

To ensure security, the minister of police has consulted with officials from more than 30 different countries whose nationals are in the country, resulting in an unprecedented level of international cooperation.

Seeking to balance a welcoming atmosphere with rigorous security standards, 40,000 police officers, 25 percent of the country’s total force, have been assigned to the Cup.  All of these activities have required a renewed spirit of cooperation between national and local agencies and departments.

Greg Pellegrino, Global Public Sector Industry Leader, Deloitte Touche Tohmatsu, said;

“South Africa has already realized many of the benefits hoped for by any national host of a major international sporting event. The event has provided a boost to national infrastructure improvements, increased employment during the global financial crisis, and provided a unifying rallying point for a still-developing nation. Moving the FIFA World Cup from a developed economy such as Germany, to an emerging economy such as South Africa, and to a continent that has never hosted the Cup, creates an important precedent for future hosts such as Brazil in 2014,”

As European countries struggle to deal with the massive debts empowered upon them by anxious governments, keen to be seen doing something during the biggest crisis of our time, investors in currency are able to change the immediate future of those countries at a stroke and the slightest of twitches have resulted in the reduction in value of  both the pound and the euro at some point or other.

Many investors have removed themselves from the fragile currency markets altogether, choosing to seek out safer havens for their own security.

It is no surprise that commodities like gold have attracted more and more investors during the crisis, resulting in all time high values for the precious metal.

The value of gold increased so much in recent times that in the UK shops buying used gold jewellery and such were springing up on every street corner.

This in itself led to unscrupulous entrepreneurs with little or no knowledge of the precious metal markets, opening their own shops and in some cases ripping of customers and bringing the market into disrepute.

While gold remains a decent investment it is fair to say that like any other commodity prices will fluctuate and recent developments in the market have shown a dip in market prices.

Smaller items like coins are no longer in such great demand and if you are looking to sell gold jewellery for instance, now maybe a good time to do so.

Some financial experts are predicting a fall in gold and other precious metal prices  as European currencies bounce back a little as we fight our way out of recession.

The seven-year-old Intelius gave over $360,000 to more than a dozen local and national nonprofit organizations in 2009, with nearly $260,000 of that amount going to Washington State nonprofit organizations. With just 260 employees, 2009 donations set a record for the company.

Intellius was founded by Naveen Jain in January 2003 as an information commerce company whose services include background checks, pre-employment screening, criminal checks and an award-winning identity theft prevention service.

In the seven years since it was founded Intellius has become one of the Top 100 most trafficked business sites on the web, offering crucial information for a myriad of commercial applications.

It is no surprise given the business acumen and generosity of the CEO Naveen Jain, that he learnt his trade under Bill Gates at Microsoft, where he became a senior executive before launching his own InfoSpace business in 1996.

Since then Jain has moved from strength to strength, working seven days a week, often for eighteen hours a day, it is no fluke that his businesses have become so successful.

mothercare expanding

Baby product and children’s wear retailer Mothercare, who announced an 11% increase in profits recently, have announced expansion plans for both the UK and overseas markets.

Mothercare say that they will be taking on an extra 400 staff in the UK over the next three years and will be increasing the rate of new overseas outlets in what the company call an ‘ideal expansion time.’

The retailer, which also owns the toy chain Early Learning Centre, has plans to reduce its presence on the UK high street and concentrate its efforts on opening more out of town mega stores, which currently makes up 40% of their UK store space and produces 65% 0f turnover and profit.

The company are also keen to increase its presence worldwide after recording a ‘record first half ‘ in its international division, where sales from its 694 overseas stores rose by almost a third. The company opened 85 new stores during the period including franchises in China and India.

Mothercare CEO Ben Gordon said it was an ideal time for expansion as ‘Landord’s are negotiating. The boot is on the other foot right now’ and revealed that the retailer has had a ‘lot of success’ in reducing rents.

The stock market has become more unpredictable than it was in the past. The once flourishing real estate market has shown a steep decline. People are desperately looking for ways to get out of debt. The present economic dilemma plaguing the United Kingdom and the other first world countries is a result of the global economic depression.

The International Monetary Fund (IMF) predicted a fall in global income particularly this year and also a drop in global trade. Interest rates have been reduced to 0.5%, which is the minimum in the history of the United Kingdom for 315 years.

The shortfall of the UK government surpassed 10% of the Gross Domestic Product (GDP) in 2008 and might be even more in the next few years. Job losses struck 2.1 million people and analysts are cautioning that it would simply cross the barrier of 3 million by the end of 2009.

Inflation dropped steeply from 5.2% to 2.9% in the month of September 2008. Banks are still unwilling to offer money, which sustains the credit dilemma. With the present economic disaster, a basic Keynesian model i.e. the Fiscal (hike in government expenses and reduction in taxes) and Monetary Policy (reduction in interest rates to raise the supply of money in the economy) should be utilized to increase demand and thus support the economy.

However, the fact is we are not surviving in a one-period world and government deficit hikes made at present encourage public sector debt later on. The United Kingdom is presently applying a blend of the two models. However, this does not appear to be politically viable and reliable in the present financial market.

So what should the current government do? Many experts are of the opinion that the government should not do anything and instead wait for the economy to improve. Economic cycles are usual and this might be one of the causes behind this view.

They also feel that there is no emergency requirement for a dynamic fiscal policy. There is need for reconsideration as to how to save the financial/banking sector so that it minimizes public fund usage. Concentration should be on establishing more trustworthy banking institutions.

That is all except Germany where  job losses are in line with what was first estimated when Magna made their bid for the Opel business. Magna appear to have agreed a deal with the German government that will see a pre agreed figure of around 2,600 job losses in the country with the guarantee of keeping all four of its plants open.

Opel employ 25,000 workers in Germany and the deal has been seen as a victory for chancellor Angela Merkel, as the country nears a General Election.

There are however,  no such guarantees for other factories throughout Europe where Opel employ around 30,000 workers and the company are looking to reduce that figure by around 8,000.

British unions have expressed concern about the long-term future of Vauxhall’s 5,500 UK workers and its two British plants in Luton and Ellesmere Port.

Spain’s Zarragoza plant is also under threat as Magna have suggested moving some of the production to Germany.

BP said in a statement on Wednesday that it had made the find at its Tiber Prospect in the deepwater Gulf of Mexico. The well was drilled in Keathley Canyon block 102.

The area will require further appraisal to determine the volumes of oil present in the area but speculation is that it could be bigger than the Kaskida discovery that has an estimated three billion barrels of oil in place.

The find highlights the potential in the Gulf of Mexico and bodes well for other exploration in the area, including at Royal Dutch Shell’s Great White field.

The Gulf of Mexico has become increasingly important to Western oil majors as oil rich-countries such as Saudi Arabia, Venezuela and Russia reserve their richest fields to be developed by their state-owned oil companies.

Source: Reuters

fuel prices down

The sharp decline in the price of crude oil since the middle of 2008 has been blamed for a huge fall in profits from both Royal Dutch Shell and rival Exxon Mobil.

Reported profits for the period April to June 2009 showed profits at Shell had fallen 70% from the same period a year earlier at £1.4bn, while Exxon’s report showed a 66% decline for the same quarter with profits at $3.95bn.

Both companies recorded lower sales than a year earlier, with Shell down 51% and Exxon by 46%.

Shell say that global demand for oil remains very weak but they are doing everything to adapt to the situation, “We are sharpening our focus on delivery and affordability” said CEO Peter Voser.

The company says that it has achieved savings of $700million in the first half of 2009 and would continue with a programme of cost cutting during the remainder of the year. Shell say they have cut senior management positions by 20% as part of the planned savings.

Earlier this week BP also reported a big cut in profits.

The company which is owned by Tata Motors of India has said that it is not considering closing the Halewood plant at this stage, but will be shutting the factory down for around three weeks.

“Our industry has been especially badly hit by the recession and the premium sector more than others. Jaguar Land Rover’s retail sales fell by 28 percent in the past 10 months,” Chief Executive David Smith said in a statement.

Tata Motors had recently warned of imminent job cuts, on the back of  accounts for Jaguar Land Rover that reported an after tax loss of £306million over ten months, to the end of March.

The company is still hoping to secure a loan from the European Investment Bank, but are still in talks with the UK government over a loan guarantee to support the finance believed to be in the region of 340 million euros.

Despite the gloom Jaguar still went ahead with a lavish launch party for the latest Jaguar XJ last week.

While new car registrations are still well below pre-crisis figures, new car sales for June 2009 stood at 176,264 compared to 209,190 for June 2008.

Paul Everitt, chief executive of SMMT, says:

“We are now beginning to see the positive impact of the scrappage scheme translate into new vehicle registrations. SMMT expects the pace of improvement to increase in the coming months, but we can already see the industry making steady progress on the long road to recovery.”