BizResearch

International Energy Outlook 2011

Source: US Energy Information Administration (EIA)

Extract from press release

International Energy Outlook 2011 (IEO2011) published by the US Energy Information Administration (EIA) presents updated projections for world energy markets through 2035. The IEO2011 Reference case projection does not incorporate prospective legislation or policies that might affect energy markets.

Some key findings:

China and India lead the growth in world demand for energy in the future. The economies of China and India were among those least affected by the worldwide recession. They continue to lead world economic growth and energy demand growth in the Reference case. In 2008, China and India combined accounted for 21 percent of total world energy consumption. With strong economic growth in both countries over the projection period, their combined energy use more than doubles by 2035, when they account for 31 percent of world energy use in the IEO2011 Reference case. In 2035, China's energy demand is 68 percent higher than U.S. energy demand.

Renewable energy is projected to be the fastest growing source of primary energy over the next 25 years, but fossil fuels remain the dominant source of energy. Renewable energy consumption increases by 2.8 percent per year and the renewable share of total energy use increases from 10 percent in 2008 to 15 percent in 2035 in the Reference case. Fossil fuels, however, continue to supply much of the energy used worldwide throughout the projection, and still account for 78 percent of world energy use in 2035 While the Reference case projections reflect current laws and policies as of the start of 2011, past experience suggests that renewable energy deployment is often significantly affected by policy changes.

World oil prices remain high in the IEO2011 Reference case, but oil consumption continues to grow; both conventional and unconventional liquid supplies are used to meet rising demand. In the IEO2011 Reference case the price of light sweet crude oil (in real 2009 dollars) remains high, reaching $125 per barrel in 2035. Total world petroleum and other liquids fuel use increases by 26.9 million barrels per day between 2008 and 2035, but the growth in conventional crude oil production is less than half this amount at 11.5 million barrels per day, while production of natural gas plant liquids increase by 5.1 million barrels per day, World production of unconventional resources (including biofuels, oil sands, extra-heavy oil, coal-to-liquids, and gas-to-liquids), which totaled 3.9 million barrels per day in 2008, increases to 13.1 million barrels per day in 2035.

Click here to read the full report

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Overcoming the Gender Gap: Women Entrepreneurs as Economic Drivers

Source: Ewing Marion Kauffman Foundation

Extract from press release

Research shows that startup companies – particularly high-growth startups – are the most fruitful source of new U.S. jobs and offer the economy's best hope for recovery. However, despite the fact that about 46 percent of the workforce and more than 50 percent of college students are female, and that women have risen to top positions in corporate and university hierarchies, they represent only about 35 percent of startup business owners. Their firms also tend to experience less growth and prosperity than do firms started by men.

"Overcoming the Gender Gap: Women Entrepreneurs as Economic Drivers," a new paper from the Ewing Marion Kauffman Foundation, explores the reasons behind lower business startup rates among women and proposes actions that would help to realize the promise of female entrepreneurs in escalating the economy

"There are plenty of highly qualified women in science and technology – industries from which the majority of high-growth companies are born," said Lesa Mitchell, Kauffman Foundation vice president, advancing innovation, and the paper's author. "More women are entering these fields than ever before. However, while women have broken through the glass ceiling, they seem to encounter ‘glass walls' that keep them from venturing out of big companies or structured academic settings to launch their own firms at the same rate men do."

In fact, early in the startup process, women take fewer steps to position themselves to start high-growth companies, according to "Gender Differences in Patenting in the Academic Life Sciences," a landmark study released in 2006 that tracked the careers of more than 4,000 life science research faculty at U.S. universities over 30 years.

Click here to read the full report

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Key Indicators for Asia and the Pacific 2011

Source: Asian Development Bank

The Key Indicators for Asia and the Pacific 2011 (Key Indicators 2011), the 42nd edition of this series, is a statistical data book presenting economic, financial, social, and environmental indicators for the 48 regional members of the Asian Development Bank (ADB). This issue of the Key Indicators presents in Part I a special chapter—Toward Higher Quality Employment in Asia—followed by statistical tables in Parts II and III with short, nontechnical commentaries on economic, financial, social, and environmental developments. Part II comprises the first set of statistical tables and commentaries, which look at the MDGs and progress in the region toward achieving key targets. The second set of tables, which are in Part III, is grouped into seven themes providing a broader picture of economic, financial, social, and environmental developments. The aim of the publication is to provide the latest key statistics on development issues concerning Asian and Pacific economies to a wide audience including policy makers, development practitioners, government officials, researchers, students, and the general public.

This year, the ADB also presents the Framework of Inclusive Growth Indicators, a special supplement to the Key Indicators

Click here for direct link to report

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World Development Report 2012: Gender Equality and Development

Source:  World Bank

Extract from Press Release No: 2012/065/DEC

The World Development Report 2012: Gender Equality and Development details big strides in narrowing gender gaps but shows that disparities remain in many areas. The worst disparity is the rate at which girls and women die relative to men in developing countries: Globally, excess female mortality after birth and “missing” girls at birth account for an estimated 3.9 million women each year in low- and middle-income countries. About two-fifths are never born due to a preference for sons, a sixth die in early childhood, and over a third die in their reproductive years. These losses are growing in Sub-Saharan Africa, especially in countries hard-hit by HIV/AIDS.

The report also notes that the world has made significant progress in narrowing gender gaps in education, health and labor markets over the past 25 years.  Disparities between boys and girls in primary education have closed in almost all countries. In secondary education, these gaps are closing rapidly, and in many countries, especially in Latin America, the Caribbean and East Asia, it is now boys and young men who are disadvantaged. Among developing countries, girls now outnumber boys in secondary schools in 45 countries, and there are more young women than men in universities in 60 countries. Similar progress can be seen in life expectancy where women in low-income countries not only outlive men but live 20 years longer than they did in 1960.  And in much of the world, gaps in labor force participation have narrowed with over half a billion women having joined the workforce in the last 30 years.
 
Remaining gaps include the lower school enrollments of disadvantaged girls; unequal access for women to economic opportunities and incomes, whether in the labor market, agriculture or entrepreneurship; and large differences in voice between women and men both in households and societies.

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Financial Access and Stability: A Road Map for the Middle East and North Africa

Source: World Bank
 
This new World Bank report lays out recommendations for reforming the financial sector in the region. It argues that while this sector has been resilient to the global financial crisis and the subsequent political shocks of the Arab spring, it has failed to provide broad, sound and equitable access to finance.

With recent turmoil in the region and deep-seated frustration among the large youth population, this failure might have been a factor in these outcomes. The report notes that lack of access to finance is due to weaknesses in financial infrastructure, insufficient competition in the banking sector. It recognizes that the structure of MENA’s banking systems is evolving in the right direction, but levels of competition are still weak.

It goes on to describe MENA’s financial sectors as dominated by large, well-capitalized banks, but largely undiversified and uncompetitive. With very high loan concentration ratios, banks focus on providing loans to large and well-connected enterprises and industrial groups. Add to that, essential non-banking financial institutions such as insurance companies, mutual and pension funds, leasing, and factoring, are under developed with few exceptions.

The report recommends that efforts to develop a new growth agenda for the region must include a significant component of financial sector reforms. It points out the importance of implementing a comprehensive and integrated agenda for both improving access and preserving stability.

Publication website with chapter-by-chapter link

Photo from Creative Commons: Flickr:  Rachel Strohm

Renewable Energy Market Report

Executive Summary

This Key Note Market Report examines the renewable energy industry within the UK. Over the past year, consumption of renewable energy sources has increased by 9.8% from 6.9 million tonnes of oil equivalent (mtoe) to 7.6mtoe, while, over the 5-year period, consumption increased by a massive 60.3%.

Renewable energy is principally used for electricity and heat generation. Electricity generation accounted for 63.9% of all renewable energy produced in 2010, while heat generation represented just 15.8%. Biomass remained the most popular source of renewable energy throughout the review period, with 5.1mtoe consumed in 2010. Using renewable energy for transport fuel has increased dramatically over the past 5 years, with a massive surge in usage in 2008, when figures increased from 361,700 tonnes of oil equivalent to 844,500 tonnes of oil equivalent. Overall, the usage of renewable energy sources for transport fuel grew by 546.6% between 2006 and 2010.

The main factors which have had a significant impact on the renewable energy sector over the past few years have been legislative and the way in which renewable energy fits in with the UK’s low-carbon energy targets over the next four decades is an ongoing topic of debate. There is also much conjecture around whether the Government should incentivise and subsidise the market. As renewable energy projects are extremely capital intensive and, therefore, costly, they need investment and government support in order to make them commercially viable.

The market is forecast to grow dramatically over the next 4 years, as it is predicted that renewable energy will feature highly in the future fuel mix in order to secure more economically and environmentally viable energy supplies and a low-carbon future. By 2020 it is expected that the level of renewable energy used in the UK’s fuel mix will have grown, relative to 2011, by 236%.

This report is available to current London Business School staff, students and faculty from Key Note Online which can be found on the A-Z list of library databases via Portal.

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Beyond borders: global biotechnology report 2011

Source: Ernst & Young

The results highlighted in the report include:

Record-breaking profitability: Companies in the industry’s established biotech centers of Australia, Canada, Europe and the US had a record-breaking aggregate net profit of US$4.7 billion, a 30% increase from the previous year.

Aggregate funding rebounds: Companies in Canada, Europe and the US raised US$25 billion in 2010 — equalling the average for the four years before the global financial crisis.

Funding for innovation declines: In the US, large debt financings by mature, profitable companies grew by 150% over 2009. Conversely, there was a 20% decline in the amount of “innovation capital” for the sector, defined as total funding minus large debt financings.

More skewed funding: 82.6% of funding went to just 20% of US companies, up from 78.5% in 2009. The bottom 20% of companies raised 0.4% of funds, down from 0.6% in 2009.

Alliances remain strong, but not up-fronts: The total potential value of strategic alliances remained strong, totaling more than US$40 billion. However, up-front payments from partners to biotech companies dropped 37 percent to US$3.1 billion.

Deal-making slows: Merger and acquisitions (M&As) involving European or US biotech firms dropped sharply from 58 deals in 2009 to 45 deals in 2010, while the aggregate value of these transactions remained relatively flat (after normalizing the 2009 numbers to exclude the mega-acquisition of Genentech).

Click here to read the full report

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What are we paying for? Exploring executive pay & performance

Source: High Pay Commission (UK)

Taken from Foreword

The total earnings for the top-paid director at BAE Systems have increased by more than 8,000 per cent since 1978 when the company was called British Aerospace. That compares to a rise of 556 per cent in median male income over the period. Many factors have driven up pay at the top, but one of the most important when it comes to directors’ pay has been the mantra that rewards must be linked to company performance.

Since the 1980s, corporate governance reforms have all tried to align directors and shareholders’ interests by linking pay to performance. However, as we show in this latest report prepared for the High Pay Commission by Incomes Data Services, there is rarely a link between directors’ incentives and the way a company performs. In the past 10 years, the average annual bonus for FTSE 350 directors went up by 187 per cent and the average year-end share price declined by 71 per cent.

Many companies that have not survived over the period paid above the odds to their directors. This is no more evident than in pay at the bailed-out banks where rewards were much higher than the norm. Pay for performance has added to the staggering complexity of executive packages and yet there is no clear evidence that it works.

Click here to read the full report

Global Competitiveness Report 2011-2012

Source: World Economic Forum

Switzerland tops the overall rankings in The Global Competitiveness Report 2011-2012. Singapore overtakes Sweden for second position. Northern and Western European countries dominate the top 10 with Sweden (3rd), Finland (4th), Germany (6th), the Netherlands (7th), Denmark (8th) and the United Kingdom (10th). Japan remains the second-ranked Asian economy at 9th place, despite falling three places since last year.

The United States continues its decline for the third year in a row, falling one more place to fifth position. In addition to the macroeconomic vulnerabilities that continue to build, some aspects of the United States’ institutional environment continue to raise concern among business leaders, particularly related to low public trust in politicians and concerns about government inefficiency. On a more positive note, banks and financial institutions are rebounding for the first time since the financial crisis and are assessed as somewhat sounder and more efficient.

Germany maintains a strong position within the Eurozone, although it goes down one position to sixth place, while the Netherlands (7th) improves by one position in the rankings, France drops three places to 18th, and Greece continues its downward trend to 90th. Competitiveness-enhancing reforms will play a key role in revitalizing growth in the region and tackling its key challenges, fiscal consolidation and persistent unemployment.

The results show that while competitiveness in advanced economies has stagnated over the past seven years, in many emerging markets it has improved, placing their growth on a more stable footing and mirroring the shift in economic activity from advanced to emerging economies.

The People’s Republic of China (26th) continues to lead the way among large developing economies, improving by one more place and solidifying its position among the top 30. Among the four other BRICS economies, South Africa (50th) and Brazil (53rd) move upwards while India (56th) and Russia (66th) experience small declines. Several Asian economies perform strongly, with Japan (9th) and Hong Kong SAR (11th) also in the top 20.

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Quid Pro Quo: Redressing the privileges of the banking industry

Source: nef

Extract from Executive Summary

A fair deal for taxpayers?

Banks occupy a unique position in our economy and enjoy privileges that other industries can never hope for. This is most obvious in the way that major banks – Northern Rock, Royal Bank of Scotland, and Lloyds TSB – were bailed out by the government during the financial crisis, moves that have prompted a great deal of public concern.

But these bail-outs were just the tip of the iceberg. All the large banks also benefit from an implicit subsidy from taxpayers; because they will be bailed out, if necessary, markets view lending to them as low risk. This report quantifies this ‘too big to fail’ (TBTF) subsidy using methodology developed by the Bank of England. We found that while the TBTF subsidy has fallen from its mid-2009 peak, the ‘big five’ UK banks still enjoyed a combined TBTF subsidy of £46 billion in 2010. The TBTF subsidy in the UK is 62 per cent higher than in Germany, despite the latter having a significantly larger economy.

Barclays, Lloyds, RBS, HSBC, and Nationwide enjoyed subsidies of £10 billion, £15 billion, £13 billion, £7 billion, and £1 billion respectively. Whilst the government does not transfer these funds directly to the banks, it does pay for the subsidy indirectly through its own borrowing costs, which increase to reflect the additional risk it is taking on board.

This is not all, banks benefit from further special treatment:

• No VAT. Banks and other financial services enjoy exemption from VAT which likely saves them billions of pounds each year.
• Subsidised deposit insurance. In addition to bailing out a number of banks, taxpayers bailed out the UK’s deposit guarantee scheme to the tune of £19 billion during the financial crisis. The government does not promise to pay the debts of non-financial companies when they fail.
• Access to the Bank of England as lender-of-last-resort. Banks can borrow from the central bank when other banks will not lend to them. There is no such lender of last resort for other industries.
• Privatised gains and socialised losses. Taxpayers are deeply out of pocket not just for the bank bail-out, but also £5 billion per year in ongoing financing charges for these schemes. This is not helped by corporation tax cuts, which are likely to cancel out revenue brought in by the recently introduced Bank Levy.

The ICB’s primary prescription for tackling the TBTF issue is to ring-fence retail banking from investment banking activities. Yet the Commission admits that ringfencing will only reduce and not eliminate the subsidy.

Click here to read the full report

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Internet Access - Households and Individuals, 2011

Source: Office for National Statistics

Summary

This release looks at how individuals access the Internet and why. It will be useful for those interested in the Internet and how its use is changing how people live, and communicate. For example, this bulletin contains information on the extent to which young people communicate via social networking.

There have been significant changes in the way people connect to the Internet in recent years. In 2011 almost half of Internet users connected to the Internet, using a mobile phone, while away from the home or office. There were 17.6 million mobile phone Internet users in 2011, representing 45 per cent of Internet users, compared to 8.5 million users (23 per cent) in 2009.

The use of wireless (wi-fi) hotspots also increased markedly with 4.9 million people using hotspots at hotels, restaurants, airports etc, compared to 0.7 million people in 2007.

The results from this bulletin are derived from the National Statistics Opinions survey. Also
released today are quarterly experimental statistics on Internet users and non-users relating to 2011 Q2, derived from the Labour Force Survey (LFS). The LFS is a much larger survey than the Opinions survey and allows more detailed socio-demographic analysis. Care should be taken when comparing results from the two releases.

Key points

• 45% of Internet users used a mobile phone to connect to the Internet
• 6 million people accessed the Internet over their mobile phone for the first time in the previous 12 months
• The use of wireless hotspots almost doubled in the last 12 months to 4.9 million users
• 215 of Internet users did not believe their skills were sufficient to protect their personal data
• 77% of households had Internet access

Click here to read the bulletin

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UK: Income inequality: Trends and Measures

Source: The Equality Trust

Key Points

• UK income inequality increased by 32% between 1960 and 2005. During the same period, it increased by 23% in the USA, and in Sweden decreased by 12%.


• In the 1960s Sweden and the UK had similar levels of income inequality. By 2005 the gap between the two had increased by 28%.


• Since the 1980s income inequality in the United States and the UK has increased substantially and has returned to levels not seen since the 1920s.

The growth in inequality in the last 30 years has been driven by the top 1% of wage incomes.
• Inequality measures drawn from standard household surveys underestimate income inequality by as much as 10 percentage points, due to the under-representation of the top 1% of incomes.


• There is scope for governments to tackle inequality. Large income inequalities are not inevitable; Sweden owes its high levels of equality to policies introduced since the 50s.

Equality trust research digest: trends & measures 2:2011