EGS Biweekly Global Business Newsletter Issue 75, Tuesday, February 7, 2023

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First, A Few Words of Wisdom From Others

“A journey of a thousand miles begins with a single step.”, Ancient Chinese proverb

“Happiness and freedom begin with one principle. Some things are within your control and some are not.”, Epictetus, 55-155 AD

“The desire for safety stands against every great and noble enterprise.”, Tacitus, 56-117 AD

Highlights in issue #75:

NOTE: Bolded headlines in this newsletter are live links where the article is available without a paid subscription.

Interesting Data and Studies

“IMF Boosts Global Growth Forecast, Saying a Recession Is Unlikely – The IMF upgraded its forecast for world growth to 2.9% from a previous prediction of 2.7% in October. It sees the expansion accelerating to 3.1% in 2024. In 2022, it estimates the world economy grew 3.4%. ‘The year ahead will still be challenging,’ said IMF Chief Economist Pierre-Olivier Gourinchas. ‘But it could well represent the turning point, with growth bottoming out and inflation declining.’”, Barron’s, February 3, 2023

“The world’s most, and least, democratic countries in 2022 – The EIU’s global democracy index shows several authoritarian rulers tightened their grip. The annual survey rates the state of democracy across 167 countries on the basis of five measures with a maximum score of ten—electoral process and pluralism, the functioning of government, political participation, democratic political culture and civil liberties. The latest edition finds that almost half (45.3%) of the world’s population live in a democracy of some sort, while more than a third (36.9%) live under authoritarian rule.”, The Economist, February 1, 2023

“GDP Growth Forecasts by Country, in 2023 – Since Russia’s invasion of Ukraine early last year, talk of global recession has dominated the outlook for 2023. High inflation, spurred by rising energy costs, has tested GDP growth. Tightening monetary policy in the U.S., with interest rates jumping from roughly 0% to over 4% in 2022, has historically preceded a downturn about one to two years later. For European economies, energy prices are critical. The above infographic maps GDP growth forecasts by country for the year ahead, based on projections from the International Monetary Fund (IMF) October 2022 Outlook and January 2023 update.”, Visual Capitalist / Markets In A Minute, February 2, 2023

“Global Unemployment in 2022 – In poor countries, employment has increased but job quality remains low. The global economy is facing a potential recession in 2023 that threatens to undo the post-pandemic job recovery. Globally, employment has increased but job quality remains low, especially in lower-income countries where informal employment is prevalent. The volatility in markets and pessimistic economic climate are hindering investment and slowing productivity. Access to quality jobs with strong wages is becoming increasingly difficult.”, Geopolitical Futures, February 3, 2023

“2023 Business Predictions As AI And Automation Rise In Popularity – A Deloitte study recently found that over 50% of organizations are planning on incorporating the use of AI and automation technologies in 2023. While many top executives are worried about the risks of AI usage, other high-achieving organizations are adopting new tech-savvy operational processes. A survey of Global 500 companies found that leaders choosing to invest in AI and automation business tools and software solutions expect to see significant growth within the next few years. To help your business prepare for a successful year, here are some predictions of how business practices will evolve in 2023.”, Forbes, February 2, 2023

“The Top 50 Most Visited Websites in the World – Estimates vary, but there are upwards of two billion websites in existence in 2023. Topping the list of most-visited websites in the world is, of course, Google. With over 3.5 billion searches per day, Google has cemented its position as the go-to source for information on the internet. The company also owns YouTube, the second-most popular website in the world. Together, Google and YouTube have more traffic than the next 48 websites combined. The power of YouTube, in particular, is sometimes not fully understood. The video platform is the second largest search engine in the world after Google.”, Visual Capitalist, January 24, 2023

Global Supply Chain, Energy, Commodities, Inflation & Trade Issues

“What inflation means for the Big Mac index – The competitive advantage of fast-food nations. The iconic McDonald’s burger is an amalgam of rent, electricity and labour, as well as beef, bread and cheese. Its price is therefore indicative of broader inflationary pressures. And because the burger is basically the same wherever you are in the world, its price can also reveal how inflation has changed the relative costliness of different countries. The combination of rising prices and a rising currency threatens to move American prices out of whack with those elsewhere in the world. Two years ago, for example, the Big Mac was 26% cheaper in Japan than America. In principle, this suggests the yen was undervalued and should have risen against the dollar. A Big Mac is now more than 40% cheaper in Japan.”, The Economist, January 25, 2023

“Visualizing the Scale of Global Fossil Fuel Production – Fossil fuels have been our predominant source of energy for over a century, and the world still extracts and consumes a colossal amount of coal, oil, and gas every year. In 2021, the world produced around 8 billion tonnes of coal, 4 billion tonnes of oil, and over 4 trillion cubic meters of natural gas. Most of the coal is used to generate electricity for our homes and offices and has a key role in steel production. Similarly, natural gas is a large source of electricity and heat for industries and buildings. Oil is primarily used by the transportation sector, in addition to petrochemical manufacturing, heating, and other end uses.”, Visual Capitalist, January 31, 2023

“BP cuts long-term forecast for oil and gas demand – Group’s latest annual outlook says energy security concerns will spur more investment in renewables. BP has trimmed its outlook for oil and gas demand in its latest annual forecast, arguing that the upheaval unleashed by Russia’s invasion of Ukraine will push countries to pursue greater energy security over the next decade by investing in renewables. As a result, global carbon emissions could peak earlier in the 2020s than it had previously suggested, BP (British Petroleum) said in its annual energy outlook on Monday.”, The Financial Times, January 29, 2023

Global & Regional Travel Updates

“Rising Jet-Fuel Costs Threaten to Send Airfares Higher – Prices have jumped, partly because of swelling travel demand as China eases its Covid restrictions. Prices for the kerosene-based product have been climbing since December, propelled by diminished supplies after winter storms shut down refineries. Swelling demand has also pushed up prices, as millions of Chinese travelers took to the skies to celebrate the Lunar New Year and newfound freedom from Covid restrictions. The global jet-fuel price index maintained by S&P Global is up 20% since Dec. 7, while prices on the U.S. East Coast are up about 77%.”, The Wall Street Journal, February 2, 2023

“Final Boeing 747 rolls off assembly line: “It’s not just another airplane”. The 747 was the world’s first jumbo jet. Twice as big as any other airliner when it first flew back in 1969. Pan-Am welcomed the first passengers on board a year later. Over more than 118 million flight hours and counting, the 747’s four engines have carried millions of passengers, six U.S. presidents and even the space shuttle across the country and around the world. After 1,574 of the 747s were built, this marks the end of the line for the Queen of the Skies at Boeing.”, CBS News, February 4, 2023

Country & Regional Updates

Canada

“As COVID-19 wanes and recession lurks, corporate profits boom – In spite of inflation, spiking interest rates and the threat of recession, 2022 was a great year for corporate Canada, with the biggest companies in the country having more than rebounded from COVID. A Globe and Mail study of the financial statements of more than 200 publicly traded companies shows that, in the first nine months of 2022, revenue was up 37 per cent and net income was up 40 per cent over the first nine months of 2019, the last “normal,” prepandemic year of business. The growth in corporate earnings – which can be seen across multiple measures of profitability – is outpacing workers’ wages and the Canadian economy as a whole.”, The Globe and Mail, February 6, 2023

China

“China economic activity swings back to growth in January – The official purchasing managers’ index (PMI), which measures manufacturing activity, rose to 50.1 in January from 47.0 in December, the National Bureau of Statistics (NBS) said on Tuesday. Economists in a Reuters poll had predicted the PMI to come in at 48.0. Since the result was above 50.0, it implied growth. A rebound in non-manufacturing activity was more decisive than expected by economists – but helped by a seasonal surge in spending for the Lunar New Year holiday. That index, which covers services, leapt to 54.4, from 41.6 in December.”, Reuters, January 31, 2023

“Shanghai shopping malls poised for surge of new tenants chasing post-pandemic ‘revenge spending’ spree – At least 13 global chain-store operators have already set up or plan to open their first mainland Chinese shops in Shanghai this year. China’s exit from its zero-Covid strategy will unleash pent-up demand for packaged food and personal-care products, according to a study. “In 2023, a strong recovery of shopping activities will be seen from the second quarter,” said Sherril Sheng, research director for the residential sector at JLL China. “More lease agreements will be signed as new-energy vehicle, personal care brands, garment makers and outdoor sportswear companies look to open new stores.”, South China Morning Post, February 5, 2023

Eurozone & European Union Countries

“Eurozone avoids recession as economy expands in fourth quarter – Mild weather and government support help region offset energy price rises triggered by Ukraine war. Bert Colijn, senior economist at ING, the bank, said the region’s economy was showing “incredible resilience” in the face of the energy crisis triggered by Russia’s invasion of Ukraine. Tuesday’s data means that the region managed to grow in each quarter of 2022 and by 3.5 per cent over the course of the year.”, The Financial Times, January 31, 2023

“The $16 Trillion European Union Economy – The European Union has the third-largest economy in the world, accounting for one-sixth of global trade. All together, 27 member countries make up one internal market allowing free movement of goods, services, capital and people. The modern version of the EU can trace its origin to 1993, with the adoption of the name, ‘the European Union,’ the birth of a single market, and the promise to use a single currency—the euro. Since then the EU has become an economic and political force to reckon with. Its combined gross domestic product (GDP) stood at $16.6 trillion in 2022, after the U.S. ($26 trillion) and China ($19 trillion.)”, Visual Capitalist, January 23, 2023

Germany

“German economy shrinks as soaring energy costs pinch demand – Unexpected fourth-quarter contraction shows how hard manufacturing has been hit. The German economy unexpectedly contracted by 0.2 per cent in the final quarter of 2022, as high gas prices squeezed demand and placed the eurozone’s manufacturing powerhouse on the brink of recession.”, The Financial Times, January 30, 2023

India

“India economic outlook, January 2023 – Healthy domestic drivers will help India post a strong growth of 6.5%–6.9% in FY2022–23, but global economic exigencies may cast their shadows on the outlook for the rest of 2023. Apart from the customary change in dates, very little in the new year feels different from the one gone by for the global economy. Geopolitical uncertainties continue unabated, a legacy of the last year, and there’s wide consensus among economists now that the global economy is on the verge of entering a phase of severe slowdown. It is unlikely that India will remain insulated from these developments. But here is a bit of good news as far as India’s economy goes—there are enough reasons to be optimistic about India’s economic outlook in 2023. In particular, healthy domestic drivers will likely help the country post reasonably strong growth this year.”, Deloitte, January 25, 2023

Japan

“Japan Inc strives to lure skilled workers as inflation, labour crunch bite – From inflation allowances to the reskilling of workers, firms in Japan are stepping up efforts to help employees fight rising prices and a labour crunch, even though some cannot afford pay hikes that do more than offset cost-push inflation. As annual “shunto” labour talks get into full swing, momentum from both labour and management is growing for firms to offer such hikes to cushion, even if not beat, consumer inflation, which hit a 41-year high of 4% in December.”, Reuters, January 30, 2023

Saudi Arabia

“Saudi Business Confidence Hits Two-Year High As Boom Continues – The Riyad Bank Saudi PMI rose to 58.2 from 56.9 in December, well above the 50-mark separating growth from contraction. Last month’s figure was the second-highest recorded since September 2021 after November’s more than seven-year high. It’s the latest sign that last year’s economic boom is continuing even as oil prices fall from recent highs. Overall growth was an estimated 8.7% last year, Saudi official projections showed, making it the fastest growing major economy.:, Bloomberg, February 5, 2023

South Korea

“China’s reopening stirs hopes that South Korea can turn around a record trade deficit – South Korea logged a US$12.69 billion trade deficit in January, with the total value of exports falling by 16.6 per cent from a year earlier. Exports to China decreased by 31.4 per cent in January year on year, due primarily to economic disruption from Covid outbreaks. Other factors included a seasonal increase in energy imports over winter amid high global costs and a sharp drop in semiconductor export prices. Semiconductors are the biggest export item for South Korea, making up 18.9 per cent of the country’s total export value last year.”, South China Morning Post, February 1, 2023

Spain

“Spain’s economy is recovering from the pandemic, but problems persist – In January 2022, an index by The Economist, ranking 23 countries’ recoveries from the pandemic, put Spain in last place. The government criticised the index, while the opposition was bound to jeer. A year later, a similar exercise put Spain in 4th place, and it was the government’s turn to strut. And the flattering numbers continue to appear. Annual inflation, running at 5.6% in December, is the lowest in the euro zone, in part because Spain consumes little Russian gas. The main share-price index has made up most of its losses. The unemployment rate is the lowest since 2008, when the financial crisis burst a construction bubble. Tourism rebounded strongly last year.”, The Economist, January 27, 2023

Turkey

“Turkey’s tourism gains in war-hit 2022 but trade deficit widens – Turkey’s tourism revenue hit a record $46.3 billion in 2022 even as its trade deficit swelled to more than $109 billion, as a fallout from war in nearby Ukraine brought a surge of Russian arrivals but also drove up energy-import costs. But even as arrivals at Turkey’s Mediterranean beaches and historical sites brought in forex, energy imports shot up by more than 90% to $96.55 billion in 2022, the official data showed. The overall foreign trade deficit surged 137% year-on-year to $109.54 billion in 2022, according to the general trade system, the data showed, while the December deficit increased 42% from a year earlier.”, Reuters, January 31, 2023

United Kingdom

“FTSE 100 defies gloom to close at record high after US jobs surprise – The FTSE 100 closed at a record high today after unexpectedly strong jobs figures from America buoyed the value of Britain’s biggest listed companies. The benchmark UK index reached its highest ever intra-day level of 7,906.58 — beating the 7,903.5 points set on May 22, 2018 — around an hour after the employment data was released. It closed at an all-time high of 7,901.8, up 1.04 per cent during the session, topping the previous peak closing figure of 7,877.45 set on the same day four-and-a-half years ago.”, The Times Of London, February 3, 2023

“Bank of England raises UK interest rates to 4% – Hike of 0.5 percentage points lifts rates to 14-year high, but BoE says shorter and shallower recession now more likely. Publishing an updated outlook for the economy alongside the rate decision, the Bank said that inflation “is likely to have peaked” and a recession would be less severe than previously predicted, but said Brexit was damaging the economy more quickly than it had anticipated.”, The Guardian, February 2, 2023

United States

“(U.S.) Jobs Growth Was Double the Forecast. It’s a Challenge for the Fed. – Nonfarm payrolls increased to 517,000 last month, up from 223,000 jobs in December. The latest reading was more than double the 185,000-job increase expected among economists surveyed by FactSet. The unemployment rate fell to 3.4% from 3.5%, rather than rising to 3.6% as economists had estimated.”, Barron’s, February 3, 2023

“Americans fear recession, but most believe their jobs are safe – Many Americans (73%) said they had a negative outlook on the economy, according to a recent survey by fintech company Achieve. However, 74% said they didn’t believe a downturn would impact their jobs. Additionally, 73% of respondents said they had no plans to leave their current employment, signaling that the Great Resignation trend, which saw droves of workers quit their jobs in the last two years, may be coming to an end, the survey said.”, Fox Business, January 30, 2023

Brand & Franchising News

“Former Subway CEO invests in Oz health chain – Suzanne Greco, the former international chief executive of sandwich chain, Subway International, has joined Brisbane-based wellness brand City Cave as a shareholder in the international expansion of the business, according to a post on LinkedIn. City Cave has approximately 50 outlets in Australia providing float therapy, massage and sauna services, and won the NextGen in Franchising Award at the 2019 International Franchise Association annual conference in Las Vegas, an annual competition which invites young entrepreneurs from around the world to submit innovative business ideas to grow via franchising.”, LinkedIn, January 2023. Compliments of Jason Gehrke, Managing Director, Franchise Advisory Center, Brisbane, Australia

“Starbucks Net profit in the first fiscal quarter increased by 4 8 percent  year on year to US855 2 million, and the number of stores in China reached 6,090 – In terms of the number of stores, there were a net increase of 459 stores in the first quarter, and the total number of stores worldwide reached 36,170 at the end of the quarter. By the end of the first quarter, the number of stores in the United States and China accounted for 61% of the world, including 15,952 stores in the United States. In terms of the Chinese market, Starbucks also stated that in the first quarter, Starbucks China opened 69 new stores and entered 10 new cities. At the end of the quarter, the company had 6,090 stores in China, covering 240 cities.”, Caijing.com.cn, February 3, 2023. Compliments of Paul Jones, Jones & Co., Toronto

“Subway to Add Thousands of Restaurants Outside the US – The chain aims to increase its international locations to around 25,000 over 10 years from roughly 16,000 today, Mr. Chidsey said. The expansion is part of a plan to raise Milford, Conn.-based Subway’s sales to around $25 billion annually from its current $16 billion. Mr. Chidsey said that much of the company’s growth lies abroad, with sandwiches resonating well with many different dietary preferences and the chain facing much less competition. ‘The unit-growth story continues to be international,’ Mr. Chidsey said.”, The Wall Street Journal, February 2, 2023

“Why 2023 will be a year of weaker (US) sales and higher margins – Fitch Ratings expects modest restaurant growth this year. But recent price increases and an improving inflationary environment should help with profits. Low-price restaurants like Taco Bell can be expected to outperform full-service chains and those with higher prices. In 2022, restaurants watched their profits shrink even as their sales growth remained strong or even accelerated. This year should be the opposite, as last year’s price increases coupled with an improving inflationary environment lead to improved profits even as sales growth weakens.”, Restaurant Business, January 30, 2023

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Our Mission, Information Sources & Who We Are

Our biweekly global business update newsletter focuses on what is happening around the worldthat impacts new trends, health, consumer spending, business investment, economic development and travel. We daily monitor 30+ countries, 40+ international information sources and six business sectors to keep up with what is going on in this ever-changing environment. Our GlobalTeam™ on the ground covering 25+ countries provides us with updates about what is actually happening in their specific countries. 

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Over 4 decades William (Bill) Edwards has played a leadership role in the global growth of more than 40 brands. He is widely recognized as an International Problem Solver, Strategist, Advisor and a specialist on global cultures. His career covers international operations, executive and entrepreneurial experience in the energy, technology, licensing, management consulting and retail sectors. As a Global Advisor, he now shares his experiences and wisdom with senior executives to help them successfully navigate the complex international company growth landscape.

For more information on how to take your business global successfully, contact Bill Edwards at bedwards@edwardsglobal.com or +1 949 224 3896. 

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EGS Biweekly Global Business Newsletter Issue 74, Tuesday, January 24, 2023

To receive this biweekly newsletter that is read by over 1,400 people in 20 countries, click here:

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First, A Few Words of Wisdom From Others

“Success is not accident. It is hard work, perseverance, learning, studying, sacrifice, and most of all, love of what you are doing.”, Pele

“The best way to predict the future is to create it.”, Abraham Lincoln.

“The only sustainable competitive advantage is the speed with which we learn.”, Peter Senge

Highlights in issue #74:

• What the Experts See Coming in 2023

• The Biggest Global Risks of 2023

• China’s Reopening Is the Boost the Flagging World Economy Needs

• Europe may avoid recession in 2023

• PwC’s 26th Annual Global CEO Survey

• The Dipping Cost of Shipping

• Brand Global News Section:  Amrest KFC®, Subway®, Taco Bell®

NOTE: Bolded headlines in this newsletter are live links where the article is available without a paid subscription.

Interesting Data and Studies

“What the Experts See Coming in 2023 – In this, our fourth year of Prediction Consensus (now part of our more comprehensive 2023 Global Forecast Series), we’ve learned a few things about the universe of predictions, experts, outlooks, and forecasts. Experts are reasonably good at predicting the future one year out, though they are also in a strong position to help shape the future through their influential thought leadership and actions. Situations can and will flare up in unexpected ways, which can have knock-on effects on the whole system (e.g. COVID-19, Ukraine invasion). Visual Capitalist, January 11. 2023

“The Biggest Global Risks of 2023 – The profile of risks facing the world is evolving constantly. Events like last year’s invasion of Ukraine can send shockwaves through the system, radically shifting perceptions of what the biggest risks facing humanity are. Today’s graphic summarizes findings from the Global Risks Report, an annual publication produced by the World Economic Forum (WEF). It provides an overview of the most pressing global risks that the world is facing, as identified by experts and decision-makers. These risks are grouped into five general categories: economic, environmental, geopolitical, societal, and technological.”, Visual Capitalist / World Economic Forum, January 13, 2023

“Global Unemployment to Steady Despite Economic Slowdown, Says International Labour Organization – The U.N. agency sees the first episode of stagflation since the 1970s, but no similar surge in unemployment. Unemployment will stay mostly stable around the world this year and next despite a sharp economic slowdown, reflecting a shortage of workers in rich countries among other factors, the International Labour Organization said Monday.”, The Wall Street Journal, January 16, 2023

“PwC’s 26^th Annual Global CEO Survey – Winning today’s race while running tomorrow’s. Evolve or die, say 4,410 chief executives in our 2023 CEO Survey. But are they spending enough time on business reinvention? Many tell us no. Forty percent of global CEOs think their organization will no longer be economically viable in ten years’ time, if it continues on its current course…..Most of those CEOs feel it’s critically important for them to reinvent their businesses for the future.”, PWC, January 16, 2023

“Fake Meat Was Supposed to Save the World. It Became Just Another Fad – Beyond Meat and Impossible Foods wanted to upend the world’s $1 trillion meat industry. But plant-based meat is turning out to be a flop. Ever since founding Beyond Meat Inc. in 2009 with the then fantastical idea of making meat without animals, Ethan Brown has been giving the equivalent of one extremely long TED Talk. But Big Meat is still alive and well. After Beyond went public in 2019—at the time the most successful major initial public offering since the 2008 financial crisis—competitors rushed into the space, followed by a categorywide pandemic surge. Since then the industry has plunged.”, Bloomberg, January 18, 2023

Global Supply Chain, Energy, Commodities, Inflation & Trade Issues

“The Dipping Cost of Shipping – A little over one year ago, congestion at America’s West Coast ports were making headlines, and the global cost of shipping containers had reached record highs. Today, shipping costs have come back down to Earth, with some routes approaching pre-pandemic levels. The graphic above, using data from Freightos, shows just how dramatically costs have fallen in a short amount of time. The Freightos Baltic Index (FBX)—a widely recognized benchmark for global freight rates—has fallen 80% since its peak in late 2021.”, Visual Capitalist, January 23, 2023

“Global Supply Chain Pressure Index (GSCPI) – Global supply chain pressures decreased moderately in December, disrupting the upward trend seen over the previous two months. The largest contributing factors to supply chain pressures were rises in Korean delivery times and Taiwanese inventories, but these were more than offset by smaller negative contributions over a larger set of factors. The GSCPI’s recent movements suggest that developments in Asia are slowing down the index’s return to normal historical levels.”, Federal Reserve Bank of New York, January 17, 2023

Global & Regional Travel Updates

“EU delays new entry rules requiring fingerprints until autumn – Rene Vihalem, chairman of the EES programme management board, told a meeting of the EU’s large-scale IT projects committee that a revised timetable would be published in March but that ports and airports should be equipped for the system to launch by the end of the year. Under the scheme, all arrivals from outside the European Union will have four fingerprints scanned and a photograph taken. The data will be captured on the first entry to the bloc and verified on subsequent visits. Holidaymakers had been told to expect long delays, especially at British ports — where border controls are juxtaposed with French immigration formalities carried out on UK land — because of difficulties of capturing passengers’ data from inside their cars. There are also concerns of long queues at the Eurotunnel terminal in Folkestone.”, The Times of London, January 7, 2023

“Airlines Resurrect Ancient Jumbo Jets to Meet First and Business-Class Demand – The fuel-inefficient 747 and A380 are being resurrected, thanks to their large numbers of premium seats. As global air travel comes roaring back from its pandemic-induced slump, airlines are racing to provide enough capacity, particularly for premium tickets on the long-haul flights enjoying a stronger-than-expected rebound. The surge has created a surprise bottleneck for some carriers, which are finding that many of their new-generation aircraft outfitted with enough business and first-class berths are either late for delivery or still awaiting regulatory approval. So carriers have been forced to revive a venerable plane model that looked consigned to the scrap heap even before the Covid‑19 outbreak: the four-engine dinosaur.”, Bloomberg, January 11, 2023

“Airlines face hurdles to cashing in on China re-opening – U.S. and European airlines will benefit from pent-up demand for travel to China after its recent border reopening, but route approvals, fresh COVID-19 testing rules and not enough large aircraft remain barriers to rising sales, analysts and industry officials say. Travel is returning to China, the world’s largest outbound tourism market worth $255 billion in 2019, after the country ended mandatory quarantines on Jan. 8. Airfares from China are now 160% higher than before the pandemic, data from travel firm ForwardKeys shows, due to limited supply.”, Reuters, January 17, 2023

“American Airlines To Restart Nonstop Dallas/Fort Worth-Shanghai Flights – China has finally reopened to the rest of the world, and international air travel demand to the country has already surged. However, due to conflicting capacity restrictions and geopolitical tensions, most US airline schedules have taken some time to adapt to the sudden demand. One carrier making such adjustments is American Airlines, which has now announced the resumption of flights to Shanghai. The last time American Airlines operated non-stop flight services between Dallas-Fort Worth International Airport and Shanghai Pudong International Airport was in March 2020, when it was suspended due to the impending pandemic.”, Simply Flying, January 9, 2023

Country & Regional Updates

Australia

“ASX off to the best start in at least 30 years – The Australian sharemarket has posted its second-best start to a year in at least three decades as optimism grows inflation will peak lower than the Reserve Bank’s 8 per cent forecast for the December quarter. Westpac chief economist Bill Evans tipped inflation data on Wednesday would show annual price rises peaked at 7.4 per cent and would slow to 3.7 per cent this year – well below the RBA’s 4.7 per cent forecast.”, Australian Financial Review, January 23, 2023

Canada

“Inflation rate eases to 6.3% in December as Bank of Canada considers new rate hike – Canada’s inflation rate eased in December alongside a steep drop in gasoline prices, an encouraging sign for the Bank of Canada as it considers further increases in interest rates. It was the latest in a string of promising developments for inflation. The U.S. rate is continuing to fall, while prices for many resources – such as lumber and natural gas – have dropped. Companies in several industries have reported that supply chain disruptions – a key factor in recently driving up prices – are improving, too.”, The Globe and Mail, January 19, 2023

China

“China’s Reopening Is the Boost the Flagging World Economy Needs – The easing of Covid restrictions will unleash pent-up demand for commodities, consumer goods and travel. Around the world, economies that rely on tourism and commodities are set to receive a shot from China’s sudden reopening, as consumers unleash some of the 5.6 trillion yuan ($836 billion) in excess savings they built up during the pandemic. Demand for air travel, hotels and spots at foreign schools and universities will light up as Chinese pack their bags for international travel for the first time since Covid-19 struck.”, Bloomberg, January 18, 2023

“China’s Economy Fails To Meet Government Target, Expanding 3% In 2022 – Although the data showed a marked slowdown in economic activity, it was slightly better than estimates including the World Bank’s earlier forecast of 2.7%. Officials expressed a note of optimism by saying that the economy held up under pressure from a volatile international environment as well as the difficult task to reform and maintain stability domestically. Now that China is reopening to the world, the top leadership is also voicing more support for the private sector. Officials are easing their crackdown on the property sector by providing fresh credit and allowing extensions in debt repayments, which sparked a recent rally in the shares of real estate developers. Another major source of growth, namely the internet sector, is also finding a more friendly regulatory environment as well.”, Forbes, January 17, 2023

“China’s population falls in historic shift – First decline in 60 years set to have long-term consequences for domestic and global economies. China’s population fell in 2022 for the first time in decades in a historic shift that is expected to have long-term consequences for the domestic and global economies. The world’s most populous country has long been a crucial source of labour and demand, fuelling growth in China and the world. ‘This is a truly historic turning point, an onset of a long-term and irreversible population decline,’ said Wang Feng, an expert on Chinese demographic change at the University of California, Irvine.”, The Financial Times, January 16, 2023

European Union

“Eurozone set to avoid recession this year as economists’ gloom lifts – Sharp about-turn in sentiment comes as IMF indicates it will upgrade its global economic forecasts.  The eurozone will avoid a recession this year according to a widely-watched survey of economists which illustrates the sharp about-turn in global economic sentiment in the past couple of weeks. The upgrade comes after officials and business leaders at this week’s annual World Economic Forum in Davos also embraced a more upbeat outlook, and the IMF signalled that it would soon upgrade its forecasts for global growth.”, The Financial Times, January 22, 2023

“Europe may avoid recession in 2023, economic chiefs say – Economic officials from the European Union on Monday offered a rosier vision for the bloc’s economic future, with the latest data showing Europe may avoid a recession that had been predicted several months ago.  EU Economic Commissioner Paolo Gentiloni said that although the bloc’s economic situation ‘is still uncertain … we had some encouraging news. We managed to reduce our energy dependence, energy prices went down significantly and inflation peaked last year in Europe,’ Gentiloni said ahead of monthly talks with eurozone finance ministers in Brussels. ‘So, there is a chance to avoid a deep recession and maybe to enter a more limited, shallow contraction,’ he added.”, Deutsche Welle, January 16, 2023

Germany

“German investors turn positive as recession fears wane – German investor sentiment turned positive for the first time since Russia’s invasion of Ukraine in January, in a further sign that the downturn in Europe’s biggest economy may not be as sharp as feared. The ZEW Institute’s indicator of investors’ expectations of the outlook for the coming six months, a closely watched measure of economic confidence, rose for the fourth successive month to 16.9, from minus 23.3 in December. The reading was well above the minus 15 forecast in a Reuters poll of economists.”, The Financial Times, January 17, 2023

Latin America

“Brazil and Argentina eye a common currency similar to the euro, with Latin American nations invited to join – Argentina and Brazil are in the preliminary stages of renewing discussions on forming a common currency for financial and commercial transactions, reviving an often-discussed plan that would face numerous political and economic hurdles. South America’s two largest economies have considered options to coordinate their currencies for decades, often to counter the influence of the dollar in the region. The persistent macroeconomic imbalances of both countries, together with recurrent political obstacles to the idea, has resulted in little practical progress.”, Fortune, January 22, 2023

India

“Apple wants to manufacture 25% of its iPhones in India, minister says – Piyush Goyal, India’s minister of commerce and industry, called Apple ‘another success story’ as he talked up the business credentials of the world’s fifth-largest economy. ‘They’re [Apple] already at about 5-7% of their manufacturing in India. If I am not mistaken, they are targeting to go up to 25% of their manufacturing,’ Goyal said at a conference. Last year, Apple began assembling its flagship iPhone 14 in India. It was the first time the tech giant, based in Cupertino, California, produced its latest model in India so close to its launch. Apple has been manufacturing iPhones in India since 2017, but these were usually older models.”, CVNBC, January 23, 2023

Malaysia

“Malaysia Records Trade Surplus for 25th Consecutive Year – Malaysia registered a trade surplus for a 25th consecutive year in 2022, with exports to major markets, including China and ASEAN countries, setting records boosted by global inflation. – Exports rose 25% to MYR 1.55 trillion ($355.1 billion) last year, according to the Ministry of International Trade and Industry, lifted by shipments of electrical and electronic products, petroleum, liquefied natural gas and palm oil.”, Bloomberg, January 18, 2023

United Kingdom

“From the markets to falling energy prices: 10 reasons to be cheerful about the economy – The FTSE is close to record highs, inflation is on the wane, and interest rates are close to peaking — just some of the reasons to give the country hope. Many business leaders have been quietly sharing an increased sense of optimism, which increased last week after Friday’s data showed that the UK economy had avoided the recession that many had predicted. Upbeat trading statements from Marks & Spencer and Sainsbury’s showed that shoppers kept spending during Christmas, despite the cost of living crisis.

The stock market soared, with the FTSE 100 ending the week within a whisker of its all-time high — 5 per cent up already in 2023, just 13 days in…..While 2023 may be difficult, there are reasons to be cheerful.”, The Times of London, January 14, 2023

United States

“A drop in chicken prices gives operators something to cluck about – Current costs and supply are favorable, giving chicken concepts a reason to celebrate after steady price increases. But the year ahead may bring changes. Jim Bitticks, president and COO of Los Angeles-based Dave’s Hot Chicken, gets positively jubilant when he talks about the current price of chicken. ‘We use jumbo chicken tenders,’ he said of Dave’s menu. ‘Six months ago, they were over $3 a pound, but now they’re holding steady at 98 cents. They’ve been dropping in price since October.’ David Maloni, foodservice supply chain analyst and president of Datum FS, agrees that chicken breast prices have fallen drastically over the last six months, as have wings. But, he cautioned, prices are at their bottom and will move higher over the next six months.”, Restaurant Business, January 11, 2023

Brand & Franchising News

“AmRest sells its KFC restaurant business in Russia for 100 mln euro – Madrid-based restaurant operator AmRest said on Tuesday it agreed to sell its KFC restaurant business in Russia for at least 100 million euros ($104.48 million) to Russian restaurant and entertainment company Almira. AmRest follows hundreds of Western companies which have either withdrawn, sold or closed down operations in Russia since the invasion of Ukraine in February. Before the Ukrainian crisis, Russia was one of the main markets for the restaurant operator.”, Reuters, December 7, 2022. Compliments of Jason Gehrke, The Franchise Advisory Centre, Brisbane

“Subway Explores Sale That Could Value Sandwich Chain at More Than $10 Billion – Biggest restaurant chain by U.S. locations is in the midst of a turnaround – Sandwich chain Subway has retained advisers to explore a sale of the closely held company, according to people familiar with the situation. The process, which is in the early stages, is expected to attract potential corporate buyers and private-equity firms, and could value Subway at more than $10 billion, the people said. Still, it is possible there won’t be a sale or other deal.”, The Wall Street Journal, January 11, 2023

“The Next Wave of On-Demand Restaurant Delivery – Successful ghost kitchen models are learning from the successes, and pitfalls, of predecessors. Many startups across varying industries, eager to disrupt, often make a lot of mistakes out of the gate, the restaurant space is no different, however, here, the main blunder made by some of these startups was not understanding the business of hospitality from the get-go…..CEO and cofounder of OOMI Digital Kitchen, Markus Pineyro….is an example of one operator who has sat back, watched the model launch, and took copious notes. He attributes his patience and good timing to what he believes will be the winning ghost kitchen strategy.”, QSR Magazine, January 6, 2023

“Taco Bell (Canada) to open 200 new locations in partnership with Redberry Restaurants –  This will more than double the franchises’ existing Canadian location count and will establish Redberry’s position as the largest franchisee in the country. This is what restless creativity looks and feels like in (Canada). The restaurant company currently owns and operates 14 locations across Ontario. The plan to build 200 new locations will take place over an eight-year period.”, Franchiseinfo.ca, January 16, 2023

To receive this biweekly newsletter, click here : https://bit.ly/geowizardsignup

Our Mission, Information Sources & Who We Are

Our biweekly global business update newsletter focuses on what is happening around the worldthat impacts new trends, health, consumer spending, business investment, economic development and travel. We daily monitor 30+ countries, 40+ international information sources and six business sectors to keep up with what is going on in this ever-changing environment. Our GlobalTeam™ covering 25+ countries provides us with updates about what is happening in their specific countries. 

To sign up for our biweekly newsletter click here: https://bit.ly/geowizardsignup

During four-decades in international business, William (Bill) Edwards has played a leadership role in the global growth of more than 40 brands. He is widely recognized as an International Problem Solver, Strategist, Advisor and a specialist on global cultures. His career covers international operations, executive and entrepreneurial experience in the energy, technology, licensing, management consulting and retail sectors. He has been a technical specialist, manager, brand senior executive and country president. As a Global Advisor, he now shares his experiences and wisdom with senior executives to help them successfully navigate the complex international company growth landscape. To take  your business global successfully, contact Bill Edwards at bedwards@edwardsglobal.com or +1 949 224 3896. 

www.edwardsglobal.com

Download our latest chart ranking 40+ countries as places to do business at this link:

Our latest GlobalVue™ 40 country ranking

EGS Biweekly Global Business Newsletter Issue 73, Tuesday, January 10, 2023

To receive this biweekly newsletter that is read by over 1,400 people in 20 countries, click here:

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First, A Few Words of Wisdom From Others

“Try not to become a man of success. Rather become a man of value.”, Albert Einstein

“When you change your thoughts, remember to also change your world.”, Norman Vincent Peale

“I’m a greater believer in luck, and I find the harder I work the more I have of it.” , Thomas Jefferson

Highlights in issue #73:

• Natural Gas Prices Are Plunging On a Warmer Start to Winter

• Is the 4-Day Work Week the Future of Work?

• Global Consumer Trends 2023 Report: Rediscovering the Human Connection

• China’s Struggle to Contain Covid Hits the Economy Hard

• Vietnam Pulls Off Asia’s Fastest Growth as Economy Powers On

• How McDonald’s Won Russia—and Then Lost It All –

• Brand Global News Section: Burger King®, Chiplote®, Dominos®, Gelatissimo®, McDonald’s®, Popeyes®, Starbucks®, Wendy’s®, White Castle®

NOTE: Bolded headlines in this newsletter are live links where the article is available without a paid subscription.

Interesting Data and Studies

“5 Top Issues Our Columnists Are Watching in 2023 – (Foreign Policy ) FP columnists identify key trends and events to look out for in the coming year.Each December, we survey some of our experts for the most important issue they’ll be following in the coming year. Beyond the most obvious one—Russia’s ongoing war in Ukraine—here are five things Foreign Policy columnists are keeping an eye on in 2023.”, Foreign Policy magazine, January 2, 2023

“Global Consumer Trends 2023 Report: Rediscovering the Human Connection – ‘We spoke to more than 33,000 consumers in 29 countries around the world to find out what businesses need to do to win their loyalty. The answer? Act more human.’ That’s from the introduction to “2023 Global Consumer Trends,” a 31-page report from the Qualtrics XM Institute. As the pendulum continues to swing toward ever-greater use of technology, the report urges businesses seeking to improve their customer service to make 2023 the year they improve the balance of the human component in their customers’ experience.”, Franchising.com, January 1, 2023

“(McKinsey) Survey results: Expectations for company performance – Compared with last quarter, respondents share more optimistic views for their companies’ future profits. However, expectations overall for company performance are more muted than at the start of 2022. Respondents are much more likely now, compared with the September survey, to expect profits to increase: 59 percent say their companies’ profits will grow in the next six months, up from 51 percent in the previous survey. We see optimism increasing in each industry.”, McKinsey, December 21, 2022

“Is the 4-Day Work Week the Future of Work? Where did the 5-day work week come from? Who invented it? It is right for 2023, or are there better alternatives? Could 4 days be the flexible future of our work week? Or is 35 hours a week the right number, with business leaders allowing employees the option of spreading those 35 hours over however many days a week they prefer? A 4-day work week trial has been running since January 2022 across several countries, where more than 70 firms are taking part in the scheme where employees get 100% pay for 80% of their normal hours worked. After six months, data shows that productivity has been maintained or improved at most firms.”, Franchising.com, January 2023

“The safest place in the world to live is across the ocean: This country ranks most peaceful – Iceland is the world’s most peaceful country, making it a top option for the safest place to live. The Woodlands, just outside of Houston, Texas, is ranked the best city to live in America. New England states dominate the charts of the safest states to live in the United States. The top ten most peaceful countries, according to the 2022 GPI (Global Peace Index):

From USA Today, January 1, 2023

Global Supply Chain, Energy, Commodities, Inflation & Trade Issues

“Europe leads pack on LNG imports as global competition for fuel heats up – EU nations bought 101mn tonnes last year — 58% more than in all of 2021. Europe was the largest customer in the global liquefied natural gas market in 2022, with the region importing substantially higher volumes than rival buyers as it seeks to replace dwindling Russian pipeline gas supplies. In previous years, the EU lagged behind Japan and China on LNG imports, but Russia’s weaponisation of energy since its invasion of Ukraine has forced the bloc to seek alternative fuel supplies.”, The Financial Times, January 7. 2023

“Natural Gas Prices Are Plunging On a Warmer Start to Winter – Milder weather seen from Europe to China over next few weeks. Gas rationing unlikely as top importers have built stockpiles. A warmer-than-expected start to winter in large parts of the world that could linger for weeks — especially across the US — is easing fears of a natural gas crisis that had been predicted to trigger outages and add to power bills. Forecasts point to temperatures above seasonal norms for most of Europe and the US over the next several weeks. It’ll also be more mild across much of China — the world’s biggest gas importer — over the next 10 days, and Tokyo may see a temperature spike around mid-January.”, Bloomberg, January 2, 2023

“Lower energy prices put brakes on eurozone inflation – The sharp decline in CPI was driven by an easing in annual energy price inflation which rose by 25.7 per cent last month compared with the same period in 2021, down from the 35 per cent climb recorded in November. Despite the drop in headline inflation, a measure of core inflation which strips out volatile elements like energy, rose by 20 basis points to a fresh record high of 5.2 per cent last month. Services prices also rose from 4.2 per cent to 4.4 per cent, in a sign that underlying inflationary pressures remain strong.”, The Times of London, January 7, 2023

“Shipping Companies Face More Dangerous Shoals –  A price war among shipping companies is looking more likely next year: Slowing growth amid high inflation and interest rates in the U.S. and an energy crisis in Europe may culminate in recession. And the demand cliff comes as the shipping industry is also preparing for a massive delivery of new vessels.  Drewry expects 2023 will witness the largest ever addition of new ship capacity—about 2.5 million twenty-foot equivalent units (TEU), unless some deliveries are deferred. Shipping companies will struggle to manage a simultaneous decline in global trade and a surge in ship supply unless they can form alliances to curtail sailings, sell excess capacity and convince clients to sign on to long-term contracts.”, The Wall Street Journal, December 30, 2022

Global & Regional Travel Updates

“Flight Mode Off: EU To Allow Phone Use On Planes – The EU has agreed to allow phones to be used on airplanes without the need to turn phones to flight mode—a change that will make a lot of travelers very happy indeed. Thierry Breton, EU Commissioner for the Internal Market said in a statement that ‘the sky is no longer a limit when it comes to possibilities offered by super-fast, high-capacity connectivity.’ (5G) The European Commission passed the ruling although it is not yet clear when and how it will work—EU member states have been given the deadline of June 30, 2023 to enable 5G technology aboard all aircraft.”, Forbes, December 26, 2022

“Will 2023 Bring China’s Tourism Recovery? Chinese international travelers had been the world’s biggest tourism spenders for a while before the pandemic crashed international tourism markets. Chinese tourist won’t have to quarantine anymore upon returning to their home country starting January 8. As seen in data by the UN World Tourism Organization, expenditures of outbound travelers from China were still down 58 percent on average from 2019 as of June 2022.”, Statista, January 2, 2023

“Delta Air Lines to Offer Free Wi-Fi Starting Feb. 1 – Delta Chief Executive Ed Bastian said Thursday that about 80% of Delta’s U.S. domestic mainline fleet will be equipped to launch the free offering at the start of next month, with more aircraft being added weekly. The airline said free Wi-Fi will be available on more than 700 planes by the end of this year, with the service expanding to all of Delta’s international and regional planes by the end of next year.”, The Wall Street Journal, January 5, 2023

Country & Regional Updates

Australia

“Wine, Lobsters Could Be Next in China-Australia Trade Thaw – China’s trade restrictions on Australian wine, lobsters and other commodities could be the next to ease amid a warming of diplomatic ties and expectations that Beijing will soon resume imports of coal. Curbs on commodity imports will probably be eased gradually and in an unofficial manner, said Hans Hendrischke, professor of Chinese Business and Management at the University of Sydney. While there’s some confidence that restrictions will be lifted, there’s currently no indication of timing, he said.”, Bloomberg, January 5, 2023

Canada

“Small business outlook for year improves slightly, but still shows recession fears – The Canadian Federation of Independent Business says the outlook among entrepreneurs for the 12 months ahead improved slightly from last month but remains quite low. The group says its latest survey found its small business confidence indicator registered 50.9 index points in December, up 0.9 points over last month. It says that while an improvement, it remains at levels usually only seen around recession periods, while the short-term outlook dropped more than three points to 40.2.”, The Globe and Mail, December 29, 2022

China

“China Is Open Again. 13 Ways to Tap Into Its Recovery Right Now – Chinese stocks look poised to keep bouncing into the Year of the Rabbit. As authorities peel back some of the last Covid restrictions this weekend and policy makers prioritize reviving the world’s second largest economy, Chinese stocks stand to recoup some of the steep losses of the past two years.”, Barron’s, January 7, 2023

“China’s Struggle to Contain Covid Hits the Economy Hard – Faced with faltering demand at home and abroad, China’s GDP has been expanding well below target this year. Exports used to be a major driver of China’s economic recovery, but that has been tapering off. But since August this year, export growth has slowed or even slipped into negative territory, as demand from the world’s three largest importers of Chinese goods, the U.S., the EU and Southeast Asia, has weakened as high inflation has weighed on consumers’ purchasing power and inventories have piled up.”, Caixin Global, December 30, 2022

Germany

“Germany’s finance minister sees 2023 inflation at 7% – Germany’s finance minister expects inflation in Europe’s biggest economy to drop to 7% this year and to continue falling in 2024 and beyond, but believes high energy prices will become the new normal. Pushed by spiking energy prices following Russia’s invasion of Ukraine and falling Russian energy exports, Germany’s year-on-year inflation has slowed slightly in November to 11.3% from a high of 11.6% the month prior.”, Reuters, January 1, 2023

India

“India will become the world’s most populous country in 2023 – China is now suffering from a demographic slump. CHINA HAS been the world’s most populous country for hundreds of years. In 1750 it had an estimated 225m people, more than a quarter of the world’s total. India, not then a politically unified country, had roughly 200m, which ranked it second. In 2023 it will seize the crown. The UN guesses that India’s population will surpass that of China on April 14th. India’s population on the following day is projected to be 1,425,775,850.”, The Economist, November 14, 2023 (update from previous article)

“Indian economic growth to slow to 7% in 2022/23, govt forecasts – India’s government expects economic growth to slow in the financial year ending March, as pandemic-related distortions ease and pent-up demand for goods levels out going into 2023. Gross domestic product (GDP) will likely rise 7% this fiscal year, compared with 8.7% the previous year, the Ministry of Statistics said in its first estimate for the period that put manufacturing growth at just 1.6%.”, Reuters, January 6, 2023

Spain

“Spanish services activity expands again in December – Activity in the Spanish services sector expanded for the second consecutive month in December, supported by a marginally better demand environment amid slowing inflation, a survey showed on Wednesday. S&P Global’s Purchasing Managers’ Index (PMI) for Spain’s services sector, which accounts for around half of Spanish economic output, rose to 51.6 last month from 51.2 in November, above the 50.0 mark that separates growth from contraction.”, Reuters, January 4, 2023

Thailand

“Thailand’s GDP will increase by 3.2% in 2022 and 4.5% in 2023 (Fitch) – During its 2022 Thailand Sovereign and Bank Outlook Webinar, Fitch Ratings analysts said that Thailand’s economic recovery is improving, despite growing inflationary pressures and weaker global growth posing risks to the short-term comeback…..supported by steady improvements in tourism and domestic demand, while noting that higher inflation and slower global growth are downside risks to the forecast.”, Fitch, December 2022. Compliments of Sean Ngo, VF Franchising, Ho Chi Minh City

United Arab Emirates

“Dubai announces $8.7 trillion economic plan to boost trade, investment and global hub status – Dubai aims to double the size of its economy in the next decade and become one of the “top 3 economic cities around the world,” Sheikh Mohammed bin Rashid al Maktoum, the ruler of Dubai, tweeted. Recent years have seen Dubai roll out a flurry of reforms aimed at making it more attractive for foreigners and international companies to live and invest.”, CNBC, January 4, 2023

“Dubai scraps 30% alcohol tax and licence fee in apparent bid to boost tourism – It will also stop charging for personal alcohol licences – something residents who want to drink at home must have. Dubai has been relaxing laws for some time, allowing the sale of alcohol in daylight during Ramadan and approving home delivery during the pandemic. This latest move is thought to be an attempt to make the city more attractive to foreigners, in the face of competition from neighbours.”, BBC News, January 2, 2023

United Kingdom

“British Households Dialed Down Winter Gas Use to Save Cash – Use in homes was 8.7% below expectations, says BFY Group Savings show consumers’ power to lift strain on energy system. The figures are some of the first signs of British consumers’ ability to find energy savings in their homes amid record-high prices for heating. Governments in Germany and France have been more proactive in encouraging energy saving than in the UK, which only launched a campaign for demand reduction in December.”, Bloomberg, January 6, 2023

“Bosses toast reasons to cheer in 2023 – The year ahead will make a bumpy start, but business chiefs hope for a rebound after a likely bumpy start. ‘We think inflation is likely to have peaked in the fourth quarter, the Bank rate will reach 4 per cent in early 2023 and GDP will contract by about 1 per cent next year,’ said Charlie Nunn, head of Lloyds Banking Group. Cyrus Kapadia, chief executive of Lazard’s UK financial advisory arm said: “Financial markets could rebound more quickly than some expect. Despite the current economic slowdown, balance sheets remain relatively strong.”, The Times of London, January 1, 2023

United States

“U.S. Trade Deficit Narrowed Sharply in November as Global Demand Cooled – American imports fell more than exports amid high inflation and interest rates. U.S. commerce with the rest of the world declined significantly in November, shrinking the U.S. trade deficit by more than a fifth and adding to signs of a global economic slowdown through the holiday season. U.S. exports fell 2% in November from October, reflecting an ebbing appetite abroad for American products—including aircraft, food and telecommunications equipment—the Commerce Department reported Thursday.”, The Wall Street Journal, January 5, 2023

“The American economy is set for a downturn, not a crisis – The coming recession looks likely to be mild. America is heading for a recession in 2023. Over the past half-century, whenever inflation has reached an annual pace of more than 5%, it has always taken a recession to wring it out of the economy. But it will not be all gloom. There is reason to think that the coming recession will be mild. Throughout the past year the number of open jobs has far outstripped the number of available workers. Disinflation will eventually take hold, turning into outright month-on-month deflation when the recession strikes. That ought to spell the end of the Fed’s rate-increase cycle by the middle of the year, with the focus instead shifting to when it might start to loosen policy.”, The Economist, November 18, 2022

Vietnam

“Vietnam Pulls Off Asia’s Fastest Growth as Economy Powers On – GDP grows 8.02% in 2022 signaling momentum to recovery Growth beats government’s initial full-year target of 6%-6.5%. Vietnam’s economy grew at the fastest pace in Asia this year, signaling momentum just before risks from a global slowdown began to materialize.”, Bloomberg, December 28, 2022

Brand & Franchising News

“Chipotle and White Castle are spending hundreds of thousands a month on automation to combat labor shortages and rising food costs – but it is still cheaper than paying human workers. Fast-food chains are employing robots that flip burgers, brew espressos and greet customers. The move to automation is due to labor shortages and rising food costs. White Castle uses a burger-flipping, fry-making robot at 100 of its locations, each costing $3,000 a month. Chipotle has a robot that makes tortilla chips at one site – but refused to tell DailyMail.com how much it pays. The cost of these robots is cheaper than paying a human worker”, The Daily Mail (UK), January 3, 2023

“Domino’s franchisee opens 600th store in Dubai – Middle East-based Alamar Foods has opened its 600th Domino’s Pizza store in Dubai, according to a TradeArabia report. Alamar Foods in the master franchisee for Domino’s in the Middle East, North Africa and Pakistan.”, QSR Magazine, December 21, 2022

“Australian gelato franchise hits Hawaii – Gelatissimo, a 65-unit gelato concept based in Sydney, Australia, is offering American entrepreneurs a scoop of its multi-million-dollar franchise model as it rolls out its U.S. expansion plan. Opening a store in Hawaii next month at the Royal Hawaiian Center in Waikiki, the concept made its American debut earlier this year in Houston under the direction of franchisees Simon Stankevicius and Phanary Hok, who own several dessert concepts.”, Fast Causal, November 30, 2022. Compliments of Franchising.com

“How McDonald’s Won Russia—and Then Lost It All – For 30 years the fast-food icon turned meat, bread and potatoes into a display of capitalism that changed the way the country did business. Then Putin invaded Ukraine.” Bloomberg, January 3, 2023

“RBI signs master agreement to bring Popeyes, Burger King to Eastern Europe – Restaurant Brands International and McWin, a European franchisee, have signed a master agreement to bring Burger King and Popeyes to several countries in Eastern Europe. New restaurants are slated to open in 2023, according to a press release. McWin, through its newly established Rex Concepts CEE platform, is set to expand the Burger King brand in Czech Republic, Poland and Romania, and to bring the Popeyes to Czech Republic and Poland, with plans to open 600 restaurants throughout these countries over the next 10 years.”, QSR Web, November 30, 2022. Compliments of Franchising.com

“Starbucks commits to expanding in Việt Nam with 100th store plan – Starbucks is committed to expanding further in Việt Nam with its plan of opening the 100th store by the end of the second quarter this year – a decade after the first shop opened in HCM City in February 2013. Currently, the US coffee chain runs 87 outlets across seven cities and provinces nationwide with 50 in HCM City and 24 in Hà Nội and more than 1,000 employees (including 200 coffee masters).”, Vietnam News, January 6, 2023. Compliments of Paul Jones, Jones & Co., Toronto

“How Wendy’s Is Turning an All-American Chain Into a Brand for Brits – The brand’s signature sass has been adapted for UK audience. Since its U.K. relaunch in mid-2021, Wendy’s has opened 25 restaurants in the market, with sites in London, Sheffield and Brighton. Now, following a successful 18 months, it has ambitious plans to ramp things up with new spaces in Liverpool and Greater Manchester. The Ohio-founded chain’s most recent debut in the U.K. marked its third crack at the market following two previous unsuccessful forays.”, AdWeek, December 19, 2022

To receive this biweekly newsletter, click here : https://bit.ly/geowizardsignup

Our Mission, Information Sources & Who We Are

Our biweekly global business update newsletter focuses on what is happening around the worldthat impacts new trends, health, consumer spending, business investment, economic development and travel. We daily monitor 30+ countries, 40+ international information sources and six business sectors to keep up with what is going on in this ever-changing environment. Our GlobalTeam™ covering 25+ countries provides us with updates about what is happening in their specific countries. 

To sign up for our biweekly newsletter click here: https://bit.ly/geowizardsignup

During an extraordinary four-decades in international business, William (Bill) Edwards has played a leadership role in the global growth of more than 40 brands. He is widely recognized as an International Problem Solver, Strategist, Advisor and a specialist on global cultures. His career covers international operations, executive and entrepreneurial experience in the energy, technology, licensing, management consulting and retail sectors. He has been a technical specialist, manager, brand senior executive and country president.

Over the years, Bill has made or seen almost every mistake that companies can make when going global. He understands the global company world like few others. As a Global Advisor, he now shares his experiences and wisdom with senior executives to help them successfully navigate the complex international company growth landscape. To take  your business global successfully, contact Bill Edwards at bedwards@edwardsglobal.com or +1 949 224 3896. 

www.edwardsglobal.com

Download our latest chart ranking 40+ countries as places to do business at this link:

Our latest GlobalVue™ 40 country ranking

EGS Biweekly Global Business Newsletter Issue 72, Tuesday, December 27, 2022

To receive this biweekly newsletter that is read by over 1,400 people in 20 countries, click here:

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First, A Few Words of Wisdom From Others

“Transitions are a time for reflection, and a time for looking forward.”, Roy Cooper

“I’m always interested in looking forward toward the future. Carving out new ways of looking at things.”,  Herbie Hancock
 

“I believe you win the race by looking forward, not behind.”, Payal Kadakia
 

Highlights in issue #72:

• Resilience becomes essential

• 2023 Oil Outlook: China’s Reopening Signals Return Of Bull Market

• U.S. poised to become net exporter of crude oil in 2023

• China to reopen borders, drop Covid quarantine from January 8

• 12 Years of the World’s Top 10 Most Innovative Countries

• Why is KFC so popular for Christmas dinner in Japan?

• Brand Global News Section: KFC® and McDonald’s®

NOTE: Bolded headlines in this newsletter are live links where the article is available without a paid subscription.

Interesting Data and Studies

“Resilience becomes essential – Leaders continue to confront multiple crises: a geopolitical conflict, rising inflation, the lingering effects of the COVID-19 pandemic, and talent turnover. The challenges have called for broad resilience frameworks. As the Great Attrition went on unabated, with quit rates 25 percent higher than prepandemic levels, organizations found they couldn’t rely on old ways to attract and retain talent, as the same types of workers weren’t always available to fill those roles. Only 35 percent of people who left their jobs since the start of the pandemic took another one in the same industry. Companies that expand their talent-sourcing approach can expect better success for drawing different types of workers.”, McKinsey, December 9, 2022

“12 Years of the World’s Top 10 Most Innovative Countries – Every year, the UN’s World Intellectual Property Organization (WIPO) scores countries on how innovative their economies are with the Global Innovation Index. The Index scores countries on indicators of a strong innovation economy. These include R&D spend, general market strength, patent systems and output, and local labor capital. And though a few countries consistently rank high, others are moving in and out of the top 10 rankings. This graphic from Gilbert Fontana details the top 10 most innovative countries in the UN’s WIPO Global Innovation Index from 2011-2022.”, Visual Capitalist, December 20, 2022

“62% Of Consumers Use Mobile To Play Games, 76% Play More Than 1 Hour Daily – Publishers, developers, and advertisers have a new opportunity to collaborate in 2023 when it comes to in-app gaming, according to data released this week from LoopMe. The tech company, which uses artificial intelligence (AI) to improve brand-advertising performance, aggregated responses from 5,468 consumers across the U.K., 6,192 consumers across the U.S., and 6,680 consumers across Singapore. The study was fielded between October 13 and October 17, 2022. According to eMarketer….time spent with mobile gaming is half the size of in-app social, yet the amount brands spend in social amounts to $56 billion, according to Statista, is 7-times that of the mobile gaming ad revenue projected for 2024, about $8 billion.”, Media Post, December 16, 2022

Global Supply Chain, Energy, Commodities, Inflation & Trade Issues

“Global inflation tracker – Inflationary pressures are beginning to wane. Inflation has started to show signs of easing from the multi-decade highs reached in many countries following Russia’s full-scale invasion of Ukraine. High inflation remains geographically broad-based, even if it is lower in many parts of Asia.”, The Financial Times, December 26, 2022

“U.S. poised to become net exporter of crude oil in 2023 – The United States has become a global crude oil exporting power over the last few years, but exports have not exceeded its imports since World War II. That could change next year. Sales of U.S. crude to other nations are now a record 3.4 million barrels per day (bpd), with exports of about 3 million bpd of refined products like gasoline and diesel fuel. The United States is also the leading liquefied natural gas (LNG) exporter, where growth is expected to soar in coming years.”, Reuters, December 19, 2022

“2023 Oil Outlook: China’s Reopening Signals Return Of Bull Market – Rising oil prices as 2022 draws to a close signal a return to bull market conditions next year, with oil expected to cost over $100 a barrel as China eases Covid-related restrictions and supply remains at risk due to Russian aggression against Ukraine. Concerns about the economy and the potential for a global recession continue to be a brake on prices, but the continued tightness of oil supplies trumps those worries. Current production numbers will be hard-pressed to keep up with consumption as the Chinese government – the world’s biggest oil importer – lifts its zero-Covid policy.”, Forbes, December 26, 2022

“World’s Coal Consumption Set to Breach New Record This Year – Usage of the dirty fuel is likely to increase by 1.2% in 2022 Europe fell back on coal after Russia squeezed gas supply. Coal usage looks likely to increase by 1.2% in 2022, surpassing 8 billion tons in a single year for the first time, according to an International Energy Agency report published Friday. It also said consumption will likely remain at that level until 2025, as declines in advanced economies are offset by demand in emerging Asian markets, such as China and India.”, Bloomberg, December 15, 2022

“2023 will bring the true test of the West’s oil-war tactics – Oil prices have sunk to pre-war levels. They are unlikely to remain there. By the second quarter of 2023 there may be another oil shortage. Industrial users in Europe are switching from natural gas to cheaper gasoil. Consumption in India and the Middle East is proving more resilient than expected. China’s reopening will probably fuel an economic rebound after cases peak.”, The Economist, December 20, 2022

Global & Regional Travel Updates

“Travel abroad is poised ‘for a big comeback’ in 2023 as Americans eye trips to Asia, Europe – Thirty-one percent of Americans are more interested in international than domestic travel, according to a recent poll by tourism market research firm Destination Analysts. That was a six-point increase from February and a year-to-date high, according to the survey, published in November. Meanwhile, 62% of 2023 flight searches in the first week of December were for international destinations, up from 55% the same time last year, according to a recent Hopper report.”, CNBC, December 25, 2022

Country & Regional Updates

Australia

“Workforce surges to record high, jobless rate steady – The number of people in the workforce surged to a record high in November with most going straight into jobs, prompting some economists to downplay a mooted interest rate pause in early-2023. Employment increased by a huge 64,000 people over the month – more than 50 per cent higher than average – while unemployment rose by a slim 7400, keeping the jobless rate steady at a 48-year low 3.4 per cent.”, Australia Financial Review, December 15, 2022

Canada

“Canada’s Economy Keeps Growing, Bolstering Case for More Hikes – GDP on track for 1.2% annualized growth in fourth quarter Data come on heels of inflation report showing sticky core CPI. Earlier this month, policymakers said future hikes would be guided by economic data, and underlying pressures and output numbers will play a key role in determining when interest rates will stop rising.”, Bloomberg, December 23, 2022

China

“China to reopen borders, drop Covid quarantine from January 8 – Local authorities will be stripped of the power to shut down entire communities from early next month. The decision is the last step in the country’s pivot to living with the virus. The Post understands from various sources that strict control measures including compulsory quarantine for travellers coming to China will also be removed after the downgrade, since it is no longer a compulsory requirement in the category B management.”, The South China Morning Post, December 26, 2022

“Beijing, Shanghai residents back to work as China limps towards living with COVID – Mask-wearing Beijing and Shanghai commuters crowded subway trains on Monday as China’s two biggest cities edged closer to living with COVID-19 even as frontline medical workers scrambled to cope with millions of new infections. Shanghai’s lively streets on Monday contrasted sharply with the atmosphere in April and May when hardly anyone went outside. An annual Christmas market held at the Bund, a commercial district in Shanghai, was popular with city residents over the weekend. Crowds thronged the winter festive season at Shanghai Disneyland and Beijing’s Universal Studios on Sunday, queuing up for rides in Christmas-themed outfits. The number of trips to scenic spots in the southern city of Guangzhou this weekend increased by 132% from last weekend, local newspaper The 21st Century Business Herald reported.”, Reuters, December 26, 2022

European Union

“Inflation will be tough for Europe – In 2023 the full economic impact of price rises—and the energy crunch largely responsible for them—will be felt across Europe. A recession is coming, followed by a painfully slow recovery. Though Europe added to its capacity to import liquefied natural gas after Russia slashed sales, global LNG supplies will not increase by much in 2023. That means energy will remain expensive, and it will keep prices high across the rest of the economy. Hard-hit consumers and businesses will start to hold back, curbing both spending and investment.”, The Economist, December 26, 2022

Finland

“Finland Unveils Grants to Help Households Pay High Power Bills – The subsidy will be 60% of monthly electricity bills in excess of 400 euros ($420), the government in Helsinki said on Tuesday. The maximum subsidy will be 660 euros per month from January through April, and it only applies to bills for one permanent residence, according to a statement.”, Bloomberg, December 20, 2022

India

“The Population of India’s States Compared with Countries – According to United Nations projections, India is on track to become the most populous country in the world in 2023. While India’s population growth has slowed in recent years due to factors such as urbanization and increasing access to contraception, the country’s population is still expected to continue growing at a significant rate for the foreseeable future. Hypothetically, if India’s states were to all became countries today, they would take up half the spots in a ranking of the world’s top 20 most populous countries.”, Visual Capitalist, December 18, 2022

Indonesia

“Indonesia 2022 trade surplus to hit record, gap seen shrinking in 2023 –  Indonesia’s 2022 trade surplus will likely be its biggest on record, but next year the gap is expected to narrow to about $38.3 billion to $38.5 billion, a trade ministry official said on Tuesday. Resource-rich Indonesia has seen an export boom this year, riding on high global commodity prices. It booked a $50.6 billion trade surplus in the January-November period, already bigger than the last record annual trade surplus in 2006.”, Reuters, December 19, 2022

Turkey

“Turkey Hikes Minimum Wage to Ease Sting of Inflation Before Vote – Turkey’s minimum wage will go up 55% in 2023 in a bid to help ease the burden of soaring living costs on millions of people just months ahead of elections. The latest hike is an attempt to cushion households from inflation that the central bank predicts will exceed 22% next year after ending 2022 at just over 65%.”, Bloomberg, December 22, 2022

United Kingdom

“How inflation has changed the price of a (U. K.) roast dinner – The cost of a home-cooked Sunday roast for a family of four has reached its highest level in over a decade. Our tracker uses data to show how much more expensive the weekend classic has become in the past decade. Sunday roast for a family of four now costs £36.16, up 8.5 per cent from the same time last year. The rise in the price of food and non-alcoholic drink was the second largest contributor to inflation this month after rises in the cost of household bills.”, The Times of London, December 14, 2022

“The UK Produced a Record Amount of Wind Power in 2022, Easing Gas Crisis – Britain has some of Europe’s best conditions for wind power Wind is essential to easing gas crisis, reaching climate goals. The UK has some of Europe’s best wind conditions and the most turbines deployed at sea, where gusts tend to be stronger and more consistent. Britain’s wind farms produced nearly 74 terawatt hours so far this year, enough to power more than 19 million British homes, according to National Grid data.”, Bloomberg, December 21, 2022

“Retail sales lift the gloom — for now – Retailers benefited from an unexpected rebound in sales in the run-up to Christmas but are braced for it to be the last good news for a while, with sales expected to fall back in the new year, a survey shows. The survey of 138 companies, including 50 retailers, found that a net balance of 11 per cent of businesses said sales grew, up from -19 per cent in November.”, The Times of London, December 21, 2022

United States

“Some unusual products have seen their prices soar and plunge – Everything from eggs to hot tubs to used cars. Higher energy prices mean that demand for hot tubs is tanking. In the year to September 2022 eggs jumped in price by 28%, having already increased by 11% in 2021. Milk also fared poorly, with a 20% rise since the start of 2021. Both prices depend heavily on the cost of livestock feed, which has been affected by the (Ukraine) war. Markets expect the Federal Reserve to raise its benchmark rate to 4.25-4.5% by June 2023. That spells bad news for cars and other durable goods that are often bought with borrowed money.”, The Economist, November 18, 2022

“Inflation and Rising Prices Impacting Small (US) Businesses – Small business operators typically rely on the holidays for key revenue but inflation could make that more difficult this holiday season, according to the quarterly MetLife and U.S. Chamber of Commerce Small Business Index. Inflation has been a top challenge for business owners for four straight quarters. More than half (53%) of small businesses now say inflation is the biggest challenge for small business owners, a 30-percentage point increase from this time last year. Four out of five (83%) say rising prices have had a significant impact on their business this year.”, Franchising.com. December 19, 2022

“U.S. retail sales grows 7.6% in holiday season – However, this year’s holiday retail sales growth is less than the 8.5% increase last year as decades-high inflation, rising interest rates and the threat of a recession turned consumers cautious. Retailers including Amazon.com Inc and Walmart Inc in the United States offered large discounts during the holiday season to get rid of excess stock and bring back inventories to normal levels. That led to strong demand for everything from toys to electronics during the five-day-long period between Thanksgiving and Cyber Monday.”, Reuters, December 26, 2022

Brand & Franchising News

“The Year In Franchising – Looking Back on 2022 and Building on the Anticipation for 2023. Throughout the year, we saw more franchise brands continuing to grow and returning to normalization. Some industries that exceled in franchising included fast causal restaurants, home improvement concepts, personal services, education, and pet related businesses.  Although 2022 proved to be an impressive year for the franchising industry, struggles still remain. Some challenges include supply chain and distribution issues, rising cost of labor and the ability to find labor, and fighting rising rates and inflation. Despite that, the International Franchise Association (IFA) predicted that by the end of the year there would be a net gain of 17,000 new franchise establishments bringing the total count to 792,000 locations.”, Forbes, December 23, 2022

“Why is KFC so popular for Christmas dinner in Japan? Kentucky Fried Christmas! While you tuck into turkey, KFCs across Japan will be packed with diners who have ordered WEEKS in advance – Expats and tourists in Japan find it hard to get turkey at Christmas – KFC branches are booked up in advance prior to Christmas day celebrations. Quirky tradition started in 1974, when KFC advertised ‘Kentucky for Christmas’. People order weeks in advance and are prepared to queue for hours.”, The Daily Mail (UK), December 25, 2022

“McDonald’s unveils first automated location, social media worried it will cut ‘millions’ of jobs – Customers can fully avoid interacting with any humans during their order and pickup. McDonald’s opened its first automated restaurant, with machines handling everything from taking orders to delivering the food – and dividing opinions everywhere.  The Fort Worth, Texas, location uses technology to minimize human interaction when ordering and picking up food. The restaurant features an “Order Ahead Lane” where customers can receive orders by conveyor belt, Newsweek reported.”, Fox Business, December 24, 2022

“(U. S.) Restaurant Staffers Are Returning to Work After Covid Flight – Employment nears prepandemic levels as pay and working conditions improve. This past month, restaurants and bars had nearly doubled the number of employees working at the pandemic low in April 2020, according to the Labor Department. The past month alone, restaurants and bars added 62,000 jobs. Restaurant owners and workers attribute the return to a combination of factors including pay increases, improving working conditions and fewer opportunities elsewhere as the economy weakens.”, The Wall Street Journal , December 26, 2022

To receive this biweekly newsletter, click here : https://bit.ly/geowizardsignup

Our Mission, Information Sources & Who We Are

Our biweekly global business update newsletter focuses on what is happening around the worldthat impacts new trends, health, consumer spending, business investment, economic development and travel. We daily monitor 30+ countries, 40+ international information sources and six business sectors to keep up with what is going on in this ever-changing environment. Our GlobalTeam™ covering 25+ countries provides us with updates about what is happening in their specific countries. 

To sign up for our biweekly newsletter click here: https://bit.ly/geowizardsignup

During an extraordinary four-decades in international business, William (Bill) Edwards has played a leadership role in the global growth of more than 40 brands. He is widely recognized as an International Problem Solver, Strategist, Advisor and a specialist on global cultures. His career covers international operations, executive and entrepreneurial experience in the energy, technology, licensing, management consulting and retail sectors. He has been a technical specialist, manager, brand senior executive and country president.

Over the years, Bill has made or seen almost every mistake that companies can make when going global. He understands the global company world like few others. As a Global Advisor, he now shares his experiences and wisdom with senior executives to help them successfully navigate the complex international company growth landscape. To take  your business global successfully, contact Bill Edwards at bedwards@edwardsglobal.com or +1 949 224 3896. 

www.edwardsglobal.com

Download our latest chart ranking 40+ countries as places to do business at this link:

Our latest GlobalVue™ 40 country ranking

EGS Biweekly Global Business Newsletter Issue 71, Tuesday, December 13, 2022

To receive this biweekly newsletter that is read by over 1,400 people in 20 countries, click here:

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First, A Few Words of Wisdom From Others

“If you want the rainbow, you have to put up with the rain.”, Dolly Parton

“When creativity melds together with global issues, I believe you can bring the world together.”, Virgil Abloh

“A smooth sea never made a skilled sailor.”, Franklin Roosevelt

Highlights in issue #71:

• Chinese Cities Continue Shift From ‘Zero-Covid’

• How retailers in Europe can navigate rising inflation

• UK banking rules in biggest shake-up in more than 30 years –

• Global flows: The ties that bind in an interconnected world –

• Airfares Set for Big Jump Again in Business and Economy in 2023 –

• Brand Global News Section: Burger King®, Denny’s®, Dine Brands Global, Domino’s Pizza Enterprises (DPE), Empower Brands, McDonalds®, 9Round®, Wendy’s® and Xponential Brands®

NOTE: Bolded headlines in this newsletter are live links where the article is available without a subscription.

Interesting Data and Studies

“Global flows: The ties that bind in an interconnected world – Economic and political turbulence have prompted speculation that the world is already deglobalizing. But the evidence suggests that global integration is here to stay, albeit with nuance. Ours is an interdependent world, connected by global flows of goods, services, capital, people, data, and ideas. Global value chains have been built on these flows, creating a more prosperous world. However, in light of the pandemic, Russia’s invasion of Ukraine, and years of rising tensions between the United States and China, some have speculated that the world is already deglobalizing. New MGI analysis finds a more nuanced reality.”, McKinsey, November 15, 2022

“Around the globe, spiraling debt in low- and middle-income countries is threatening their pursuit of sustainable development. Between 70 percent and 85 percent of developing nations’ debt is in a foreign currency. So far in 2022, around 90 percent of countries have seen their currencies depreciate against the U.S. dollar. Government debt levels as a share of gross domestic product have increased by about $2 trillion.”, Geopolitical Futures, December 9, 2022

“World’s oldest DNA reveals Ice Age ecosystem – Scientists harvested eDNA from sediment thawed from permafrost in northern Greenland. Unlike genetic material from one animal, eDNA is the microscopic spoor of many different species, including plants and micro-organisms. The 2m-year-old ecosystem was home to birch trees, geese, lemmings, reindeer and even mastodons, an extinct elephantine creature.”, The Economist, December 10, 2022

Global Supply Chain, Energy, Commodities, Inflation & Trade Issues

“Globally, Home Prices Climbed a Robust 8.8% in the Third Quarter Despite Rocky Economies – The third-quarter figure is in nominal terms—that is, not adjusted for inflation—and is down from its peak of close to 11% registered during the first quarter of 2022, the brokerage and property consultant said in its analysis of 56 countries and territories around the world. Property markets that are slipping down the table are those that have seen the most significant interest rate hikes, the report said.  In the past three months, Canada has moved from 10th to 34th place in the rankings, and Australia from 28th to 47th.”, Barron’s, December 8^th.

“Why the price of oil has dropped despite new constraints on Russian supply – Crude settles at lowest level of 2022 after European embargo and G7 price cap take effect. This week marked a pivotal moment in global geopolitics, as a European embargo and G7 price cap on Russian crude came into force. All of this would ordinarily have sent oil prices sharply higher, especially just weeks after the Opec+ cartel surprised the market by announcing deep new supply cuts. Yet on Thursday, the international oil benchmark Brent settled at $76.15 a barrel, a new low for 2022. What is going on? But the G7’s price cap plan aims to take the edge off.”, The Financial Times, December 8, 2022

“How retailers in Europe can navigate rising inflation – With inflation at record highs throughout Europe, retailers are under more pressure than ever. Those that act quickly and follow a holistic playbook can be well positioned to thrive. In this article, we examine the current state of inflation in Europe, take a quick dive into rapidly changing consumer behavior and sentiment, and draw lessons from previous periods of economic volatility. Finally, we describe a holistic approach that can help retailers think about how to simultaneously tackle inflationary challenges and build long-term resilience.”, McKinsey, December 7, 2022

Global & Regional Travel Updates

“Airfares Set for Big Jump Again in Business and Economy in 2023 – Airfares will increase around the world next year, by as much as 12% on Europe-Asia routes and 10% for North America-Asia flights, according to American Express Global Business Travel.  Asia, which was slower to lift Covid travel curbs, is set for some of the biggest changes as demand swells, Amex GBT said in its Air Monitor 2023. The region’s relatively strong economic prospects could also push up prices, it said. With Europe also seeing a shortfall of airline capacity versus demand, intra-regional airfares are expected to climb 6% in business and 5.5% in economy next year, Amex GBT said.”, Bloomberg, December 8, 2022

“Delta Will Restart Service to Cuba Next Year — What to Know. Starting April 10, 2023, the airline will fly two daily nonstop flights from Miami International Airport. Delta joins JetBlue and American Airlines, which each received permission to service more flights to Cuba. The new service also comes months after the Biden administration started allowing commercial and charter flights to fly to cities beyond just Havana.”, Travel and Leisure magazine, December 12, 2022

Country & Regional Updates

Asia

Australia

“Soaring coal delivers Chalmers a Christmas miracle – Soaring iron ore, coal and natural gas prices are set to add $58 billion to tax revenue over four years and deliver Treasurer Jim Chalmers a Christmas miracle – a federal budget bottomline temporarily in balance. But while a boon for exporters, high commodity prices are driving domestic inflation, placing huge strain on household budgets, and forcing a major intervention in the energy market by the Albanese government.”, Australian Financial Review, December 4, 2022

China

“Chinese Cities Continue Shift From ‘Zero-Covid’ – Major cities across China including Beijing, Shanghai and Guangzhou, have further eased local Covid-19 restrictions on travel and quarantine after the country announced sweeping changes to its virus control regime. Following the announcement, searches containing the key word “air tickets” surged 160% on ctrip.com. Searches for the tickets on flights departing a few days before next month’s Lunar New Year soared to the highest level in three years on the online travel service platform.”, Caixin Global, December 8^th, 2022

“Shanghai Disneyland Reopens as Businesses in China Welcome Covid-Control Easing – Cautious optimism spread among foreign companies over the rollback of some zero-Covid measures, though challenges remain…..Beijing on Wednesday announced the end of many measures, including requirements covering quarantine and testing as well as restrictions on domestic travel…The policies have damaged consumer sentiment, curtailed economic growth and brought heavy disruptions to foreign businesses with large operations in the world’s second-largest economy.”, The Wall Street Journal, December 8, 2022

“China Halts Location Tracking App as Covid Restrictions Fall – Some residents say they have seen a surge in Covid cases even as official daily tallies drop. China is pulling the plug on a nationwide mobile tracking app that collects data on users’ travel movements, dismantling a symbol of one of the world’s sternest and most durable Covid-19 containment regimes even as cases continue to surge across the country. Authorities said Monday that the mobile app, a cornerstone of Beijing’s technocentric approach to throttling the pandemic, would disappear by day’s end, part of China’s swift retreat from the “zero-Covid” approach that it has adhered to for the past three years.”, The Wall Street Journal, December 12, 2022

European Union

“Where next for Europe’s industry? More evidence that factories have weathered the energy crisis well. The impact of the energy crisis on European industry continues to be debated hotly. When I (Martin Sandbu) highlighted in last week’s Free Lunch how well the continent’s manufacturing has held up, the reactions varied from denial to surprised delight. Start with Europe’s impressive ability to adapt to higher natural gas prices. My colleague Shotaro Tani added to the evidence of this, reporting on Monday that European users cut consumption by one-quarter in both October and November, relative to five-year averages. This was largely accounted for by cuts in industry demand for gas.”, The Financial Times, December 8, 2022

India

“India’s Outlook Is Surprisingly Bright – Why investors might want to park their cash in the Asian country. India’s resilient economic growth—despite global weakness—gives India’s central bank leeway to tackle inflation without worrying about a steep slowdown, particularly with Brent oil down about $40 a barrel from its midsummer highs. India’s September quarter growth came in at 6.3%, significantly lower than the previous quarter’s but much better than developed markets and many emerging markets. The RBI expects India to grow 6.8% in the current fiscal year ending in March.”, The Wall Street Journal, December 8, 2022

Mexico

“Mexican state brings back mask mandate as COVID numbers rise – A northern Mexican state reintroduced the obligatory use of face masks in closed public spaces, officials said on Monday, in a bid to reduce rising COVID-19 infections, as well as the spread of other respiratory diseases. The health minister of Nuevo Leon state, home to Mexico’s third-biggest city Monterrey, highlighted the updated guidelines in a news conference, and said that the measure will go into effect immediately.”, Reuters, December 12, 2022

New Zealand

“Air New Zealand raises first half profit outlook on travel demand – The increased profit outlook follows a moderation in fuel prices in recent weeks and assumes that the airline will fly about 75% of its pre-COVID capacity levels across the network in December, according to Air New Zealand.”, Reuters, December 7, 2022

United Kingdom

“UK banking rules in biggest shake-up in more than 30 years – The government has announced what it describes as one of the biggest overhauls of financial regulation for more than three decades. It says the package of more than 30 reforms will “cut red tape” and “turbocharge growth”. Rules that forced banks to legally separate retail banking from riskier investment operations will be reviewed.”, Yahoo News, December 9, 2022

“UK Economy Rebounds – The UK economy returned to growth in October following a 0.6 per cent fall in September, according to the latest data released this morning by the Office for National Statistics. Month-on-month gross domestic product rose 0.5 per cent. City economists had forecast growth of 0.4 per cent. September’s fall was largely attributed to the extra Bank holiday for the Queen’s funeral. In the three months to the end of October the economy contracted 0.3 per cent.”, The Times of London, December 12, 2022

United States

“U.S. third-quarter productivity raised; labor costs still running high – U.S. worker productivity rebounded at a bit faster pace than initially thought in the third quarter, though the trend remained weak, keeping labor costs elevated. Nonfarm productivity, which measures hourly output per worker, rose at a 0.8% annualized rate last quarter. That was revised up from the 0.3% pace reported last month and ended two straight quarterly decreases.”, Reuters, December 7, 2022

“Economists think inflation has peaked. Main Street is preparing for more pain – More players in the stock market and among the ranks of professional economists have come around to the view that inflation has peaked or already is in decline, but small business owners on Main Street don’t expect a reprieve from high prices any time soon, according to a new CNBC poll.An overwhelming majority (78%) of America’s entrepreneurs say they expect inflation to continue to rise, according to the quarterly CNBC|SurveyMonkey Small Business Survey. That is effectively unchanged from last quarter when 77% said they expected inflation to continue to rise.”, CNBC, December 10, 2022

“The Next Career Move For Americans Looking For A Healthier Lifestyle: Working For Themselves – Even with a record number of traditional jobs available, the number of independent workers in the U.S. keep climbing, according to new research. There are now 64.6 million independent workers in the U.S., according to “Happier, Healthier Wealthier: The State of Independence in America,” issued by MBO Partners, a provider of back-office services to independent workers. The report found that the number of full-time independents—those working 15 hours a week or more—is 21.6 million, up from 15.3 million in 2019.”, Forbes, November 30, 2022

Brand & Franchising News

“Applebee’s owner to acquire Fuzzy’s Taco Shop for $80M – Dine Brands Global, which also operates IHOP, will get its long-desired growth concept in the 138-unit fast-casual brand. On Monday, the owner of Applebee’s and IHOP, which has been expressing a desire to acquire a third concept for years, finally pulled the trigger on one, agreeing to acquire Fuzzy’s Taco Shop from NRD Holding Co. for $80 million in cash. Dine believes this will give it a growth chain and its first limited-service concept.”, Restaurant Business, December 5, 2022

“Burger King Has Released A Winter Whopper In Japan – Earlier this year in August, (Wendy’s) Japan released an Icy Whopper with a layer of shaved ice in the burger. Thankfully, this latest edition of the Whopper won’t include any ice, which probably wouldn’t be the top meal choice on a chilly winter day. According to The Street, the Winter Whopper includes gouda cheese and a spicy hot sauce. Burger King Japan’s Twitter account posted a photo that reveals this burger will hit stores on Friday, December 9.”, Mashed.com, December 12, 2022

“Here’s how Denny’s fits into the evolving family-dining breakfast category – Denny’s CEO Kelli Valade discusses brand synergy with new acquisition Keke’s, the future of the 24-hour operations model, and how customers are evolving. Valade spoke about the evolution of family dining— including the brand’s new acquisition of Florida-based Keke’s Breakfast Café, labor challenges, and operations changes — during the last CREATE Live Digital Learning Session of 2022 with NRN Senior Editor Ron Ruggless.”, Nation’s Restaurant News, December 8, 2022

“Listed Australian pizza chain franchisor Domino’s Pizza Enterprises (DPE) is expanding its footprint in Asia and Europe with a completed acquisition and the launch of an equity capital raising, according to a media report. On November 30, Domino’s advised stakeholders that their acquisition of Domino’s Malaysia and Domino’s Singapore was complete. The company’s acquisition of Domino’s Cambodia is expected to be completed in Q1 of 2023, subject to regulatory approvals.  Meanwhile, DPE is also seeking to raise a total of $165 million to buy out its business partner in the German market.”, Compliments of Jason Gerhrke, the Franchise Advisory Centre, Brisbane.

“Lynx Franchising and Outdoor Living Brands Rebrand as Empower Brands – The launch of Empower Brands comes following Lynx’s September 2021 acquisition of Outdoor Living Brands. After months of integrating the two organizations, Lynx Franchising and Outdoor Living Brands decided the best way to continue moving these brands forward was to combine forces under one, unified name. Together as Empower Brands, the team can provide more experience and an even stronger commitment to providing franchisees with a winning playbook and the right resources to pursue their long-term goals.”, Franchising.com, December 9, 2022

“9Round Finalizes Deal to Bring Facilities to South India – 9Round Franchising, LLC, has finalized a master franchise agreement to expand into South India. South India’s master franchisees Arun Bharathi, Balaji Jeyakumar and Sharmila Jayakumar will open the country’s first 9Round location in Chennai or Bangalore in early 2023. Balaji is an accomplished professional with more than nine years of experience in operations and supply chain management. Sharmila has experience in supply chain management, product development, and market research, as well as strategic planning.”, Franchising.com, December 9, 2022

“McDonald’s Careful Moves Pay Off – The fast-food leader introduces new store concepts, new menu items, and more. McDonald’s is possibly the most old-fashioned of all the big fast-food chains, rarely making major changes to its classic menu. That’s not to say Mickey D’s doesn’t embrace modernity in its own way, though. Its new test restaurant concept in Fort Worth, Texas, is smaller than its usual locations and introduces the Order Ahead lane, specifically designed for people who placed their orders using the McDonald’s app.”, The Street, December 12, 2022

“Wendy’s Is Now the Most Expensive Fast Food Restaurant in the U.S., New Data Says – Wendy’s earns the notorious title of the most expensive fast food chain this year, beating out last year’s “winner” Burger King. Wendy’s prices increased by an eyebrow-raising 35% this year, representing the largest increase in 2022 among analyzed chains (average price: $6.63).”, Eat This, Not That!, December 9, 2022

“Xponential Fitness Signs Master Franchise Agreement in Japan – The agreement was signed with Wellness X Asia, Xponential’s existing Master Franchise Partner in Japan for Club Pilates and CycleBar. Wellness X Asia (formerly Club Pilates Japan Co. Ltd.) will now be responsible for the country-wide development of Rumble and AKT, in addition to Club Pilates and CycleBar.”, Franchising.com, December 9, 2022

To receive this biweekly newsletter, click here : https://bit.ly/geowizardsignup

Our Mission, Information Sources & Who We Are

Our biweekly global business update newsletter focuses on what is happening around the world that impacts new trends, health, consumer spending, business investment, economic development and travel. We daily monitor 30+ countries, 40+ international information sources and six business sectors to keep up with what is going on in this ever-changing environment. Our GlobalTeam™ covering 25+ countries provides us with updates about what is happening in their specific countries. 

To sign up for our biweekly newsletter click here: https://bit.ly/geowizardsignup

During an extraordinary four-decades in international business, William (Bill) Edwards has played a leadership role in the global growth of more than 40 brands. He is widely recognized as an International Problem Solver, Strategist, Advisor and a specialist on global cultures. His career covers international operations, executive and entrepreneurial experience in the energy, technology, licensing, management consulting and retail sectors. He has been a technical specialist, manager, brand senior executive and country president.

Over the years, Bill has made or seen almost every mistake that companies can make when going global. He understands the global company world like few others. As a Global Advisor, he now shares his experiences and wisdom with senior executives to help them successfully navigate the complex international company growth landscape. For hard learned advice on taking your business global successfully, contact Bill Edwards at bedwards@edwardsglobal.com or +1 949 224 3896. 

www.edwardsglobal.com

Download our latest chart ranking 40+ countries as places to do business at this link:

Our latest GlobalVue™ 40 country ranking