Phnom Penh Land Prices Show Growth

Property prices in Phnom Penh increased by about 15% at the end of June compared to the same period in 2011, according to data released yesterday by local realty firm Asia Real Estate Cambodia (ARC). The average price of commercial property in Phnom Penh reached US$2,900 per square meter, up from US$2,500 per square meter at the end of last June last year, while the market price of residential property grew from about US$1,350 to US$1,550, according to the data. In Chamkarmon Mon District, resident buyers were paying an average of US$1,375 per square meter, a 10% increase, as of the end of June. However, residential properties in areas such as Boeng Keng Kang I can cost as much as US$2,400 per square meter. That is compared to just US$1,800 per square meter in June last year. On the commercial site, the cost of property in Tuol Kok district has grown from between US$1,500 to US$2,000 per square meter in June 2011.
[The Cambodia Daily]

Yuan-yen direct trading is a win-win game

Xinhua, June 3, 2012

The direct trading of the Chinese yuan and Japanese yen that began from June 1 in Tokyo and Shanghai is "definitely a win-win game for both sides," according to a senior economist of the Asian Development Bank Institute.

The direct yuan-yen trading could reduce the transaction cost and exchange risk in bilateral trading and investment, and Japanese and Chinese companies involved will benefit from the new system. said economist Xing Yuqing in an exclusive interview with Xinhua.

"However, the most important implication of the direct trading is that the Japanese yen and Chinese yuan will be utilized more in the future. I think this is the major objective for the two governments to work together to promote bilateral direct trading," Xing said.

Statistics of the Asian Development Bank Institute show that only 0.3 percent of the Chinese commodities exported to Japan and 1.7 percent of goods China bought from Japan were settled in yuan in 2011, while trade deals settled in yen are slightly higher, as the institute's 2009 figures show that 18 percent of China's exports to Japan were settled in yen.

"With the direct yuan-yen trading, the role of the U.S. dollar in bilateral trading between China and Japan would become less and less important. This might signify a gradual departure of the two countries from the dollar," he said.

The U.S. dollar has long been the vehicle currency for bilateral trade and investment between China and Japan, and volatility of its exchange rate is the major concern for everyone involved in trade between the two countries.

To Xing, the direct trading agreement is also a major step for the internationalization of the Chinese currency. "Before the Chinese yuan becomes an international currency, it should be a regional currency first."

Japan, the world's third largest economy and the second largest trading partner of China, is a perfect partner to promote the utilization of yuan, or renminbi, he said.

"That will build up a solid footing for renminbi on the way to be a regional currency and eventually become an international currency," he said. "In my opinion, the next natural step for Japan is to reach an agreement with China to set up a renminbi offshore market in Tokyo. Japan will benefit a lot from renminbi's internationalization."

The yuan-yen direct trading will also inject vitality into Tokyo's financial market, Xing said.

According to the economist, the Japanese yen has been an international currency for decades but its share is very low, so the internationalization of yen can be considered as a failure. The trading of the Chinese yuan, particularly yuan-denominated assets will provide new business opportunities for Japanese financial institutions in the post-crisis era.

From a long-term perspective, the yuan-yen direct trading will help both yuan and yen play a greater role in international trade and financing, and it may bring changes to the current international monetary system, Xing said.

GDP, GNP, GNI

Difference Between GNP, GDP and GNI

By Tejvan Pettinger on October 8, 2011 in economics

GNP and GDP both reflect the national output and income of an economy. The main difference is that GNP (Gross National Product) takes into account net income receipts from abroad.

• GDP (Gross Domestic Product) is a measure of national income / national output and national expenditure produce in a particular country.
• GNP = GDP + Net property income from abroad. This net income from abroad includes, dividends , interest and profit.
  GNP includes the value of all goods and services produced by nationals whether in the country or not.

Example of GNP

If a Japanese multinational produces cars in the UK. This production will be counted towards UK GDP. However, if the Japanese firm sends £50m in profits back to shareholders in Japan. Then this outflow of profit is subtracted from GNP. UK nationals don’t benefit from this profit.
If a UK firms makes profit from insurance companies located abroad, then if this profit is sent back to UK nationals, then this net income from oversees assets will be added to GNP.
Note if a Japanese firm invests in the UK, it will still lead to higher GNP, as some national workers will see higher wages. However, the increase in GNP will not be as great as GDP.

• If a county has similar inflows and outflows of income from assets, then GNP and GDP will be very similar.
• However, if a country has many multinationals who repatriate income from local production, then GNP will be lower than GDP.

For example, Luxembourg has a GDP  of $87,400 but a GNP of only $45,360.
A country like Ireland has received significant foreign investment. Therefore for Ireland, there is a net outflow of income from the profits of these multinationals. Therefore, Irish GNP is lower than GDP.

GNI

GNI (Gross national Income) is based on a similar principle to GNP. The World Bank define GNI as

GNI is the sum of value added by all resident producers plus any product taxes (fewer subsidies) not included in the valuation of output plus net receipts of primary income (compensation of employees and property income) from abroad. (World Bank)

 The World Bank now use GNI rather than GNP.

UK GNI

from: pdf ONS (1995)
This shows a small net income from abroad so the GNI  £715,028m is greater than GDP (£713,980)

Some important economic terms from World Bank:

High-performing Asian Economies (HPAEs), led by Japan which has a very rapid export growth.
The Four Tigers: Hong Kong, Republic of Korea, Singapore, and Taiwan, China.
Newly Industrializing Economies (NIEs): Indonesia, Malaysia, and Thailand.
East Asia: Low and middle income economies of East and SEA and the Pacific, east of and including China and Thailand.
South Asia: Bangladesh, Bhutan, India, Myanmar, Nepal, and Sri Lanka.
Sub-Saharan Africa: all south of Sahara include South Africa but excluding Mauritius, Reunion, and Seychelles, which are in the other asia and Islands group.
Europe, Middle East, and North Africa include middle income European economies of Bulgaria, the former of Czechoslovakia, Greece, Hungary, Poland, Portugal, Romania, Turkey, and the former Yugoslavia, and all economies of North Africa and the Middle East and Afghanistan.
Latin America and the Caribbean comprises all American and Caribbean economies south of the US.