Academic literature on the topic 'Consumer goods. China. China'

Purpose – Marketing research has focussed more on in-group favoritism and out-group derogation (i.e. ethnocentrism) than out-group favoritism and in-group derogation (i.e. xenocentrism). The purpose of this paper is to explore the xenocentric behavior in the consumer sphere to explain why some consumers have a bias for foreign products even when domestic ones are qualitatively similar or better. As the Chinese economy has experienced more than three decades of near double-digit growth and increased openness to foreign products, it is important to examine phenomena related to the formation of Chinese attitudes toward foreign products with the rising tensions between the seemingly irreversible globalization and Chinese re-awakening nationalism. Design/methodology/approach – This study is based on a review of the extant literature and focus groups in three cities in China. Findings – This study has found that consumer xenocentrism (CX) is prevalent in China, especially among the new emerging wealthy classes, younger consumers, and the local elite. It appears that Chinese consumers are psychologically or sociologically orientated or predisposed toward foreign (Western) goods. The findings from this study suggest that both consumer ethnocentrism and CX are possible or even expected. The short review of Chinese history presented here has shown that these phenomena can be explained by traditional in-group/out-group theories. Specifically, when there are too many xenocentrics, national esteem is threatened and this prompts many individuals to become more ethnocentric. Research limitations/implications – This study is based on the literature and focus groups data, hence, the findings are not intended to be generalizable. Practical implications – The findings from this study should be of interest to business practitioners and policy makers. Social implications – The historical and cultural perspectives taken in this study indicate that understanding consumers’ xenocentric behavior entails knowledge and deep understanding of how cultural values and contemporary social-political forces interplay within consumers’ formation and change of attitudes toward the choice of domestic and foreign products. Originality/value – This study shows that the ability of foreign products to meet the individual’s need or enhance his/her self-esteem more so than domestic products is indicative of something more than simply an international, cosmopolitan, or modern orientation. The fact that consumer foreign bias is found with both mundane and widely available products, expensive and inexpensive products, and conspicuous and non-conspicuous goods challenges the assumption that this phenomenon is simply traditional prestige-consumption behavior. Future research needs to be directed at measuring the CX construct and examine potential antecedents of such a behavior.

With the upward climbing of the Chinese fashion luxury goods market for about 30 years, China have become one of the world's biggest markets. This situation makes the research on the Chinese fashion luxury goods markets and consumer groups instructive. In this paper, the formation and development of Chinese luxury goods market were represented and analyzed. By using the methods of internet questionnaires and depth interview the consumer groups segmentation of Chinese fashion luxury goods were researched, 10 groups were got and their respective expectation elements of fashion luxury goods were researched and obtained. Some suggestions were given as reference to the design and marketing promotion of fashion luxury goods in China.

This paper delves into China’s differential growth in exports with high income and developing countries by focusing on bilateral content of China’s trade and particular exports over the time period 1979-2015. In the last 30 plus years, China has specialized in upstream capital goods and exhibited rapid diversification in consumer goods. Performing causality tests reveals a strong evidence of causality from the export growth of capital goods and consumer non-durable goods to gross domestic product (GDP) per capita. There is also evidence that the causality is bi-directional for consumer durable goods, intermediate goods, and primary non-energy goods with income. Econometric analysis shows a positive and statistical significant relationship between income and export growth of capital goods, consumer non-durable goods, intermediate goods, and primary non-energy goods. Trade openness allows stimulation of growth and efficiency as producers in China are exploiting areas in which they have a comparative advantage.

Abstract We examine the price and variety of a sample of consumer goods at the barcode level in cities within China. Unlike the position in the United States, in China the prices of goods tend to be lower in larger cities. We explain that difference between the countries by the more uneven spatial distribution of manufacturers’ sales and retailers in China, and we confirm the pro-competitive effect of city size on reducing markups there. In both countries, there is a greater variety of goods in larger cities, but that effect is more pronounced in China. Combining the lower prices and greater variety, the price indexes in China for the goods we study fall with city size by around seven times more than in the United States.

Electronic commerce is becoming increasingly important in business, but lack of intention to purchase has become a main barrier in the development of electronic commerce. Thus, effective measures are needed to promote consumers’ intentions to purchase in online consumer to consumer stores. This paper will discuss issues about goods delivery cost and delivery quality in E-commerce. According to the result of research, the paper predicts the future development trend of China E-commerce.

In the consumer purchase decisions as the starting point, as China and Kazakhstan reached agreement on the implementation of the "Belt and Road" strategy, a large number of fashionable consumer goods in China entered Kazakhstan and enriched the consumer market in Kazakhstan, also changed people's consumption concept in Kazakhstan. In order to obtain a comprehensive and effective research results, the data obtained through the market research were analyzed by using the software of SPSS 20.0 to evaluate the reliability and validity of the data and the fitting degree of the model. Through the confirmatory factor analysis and path analysis of the model, the relationship between the latent variables in the model is obtained, And the results of the investigation and the theoretical analysis are analyzed and studied in detail so as to put forward a positive research proposal to better promote the long-term prosperity of the consumer market of fashion goods in Kazakhstan under the new situation.

Potential demand for consumer goods and services is enormous in China. Turning such potential into real effective demand will play a crucial role in sustaining China’s future economic growth. Based on most recent consumption data of major categories of goods and services by consumers of different income groups, this study empirically evaluates the potential of the market for goods and services in China using the panel data of 18 provinces over the period 2002–2012. The results indicate that (1) compared to developed countries, Chinese urban residents have much potential for consuming goods including medical care, transportation and communication, education and entertainment; (2) the profile of the expenditure elasticity for necessities such as food change is hump-shaped. Residents in middle-income groups are more income-elastic than the low- and high-income groups; (3) expenditure elasticity of medical care decreases as income level rises, while the trends of transportation and communication, education and entertainment share a similar profile across income groups.

Thesis (M.A. in Security Studies (Far East, Southeast Asia, and the Pacific))--Naval Postgraduate School, December 2008.<br>Thesis Advisor(s): Weiner, Robert ; Looney, Robert. "December 2008." Description based on title screen as viewed on January 29, 2009. Includes bibliographical references (p. 93-98). Also available in print.

The big country in the Far East appeared in the past as if only big corporates could do business there. This point of view changed immensely over the past 10 years. Nowadays, numerous co-working spaces, maker spaces, and incubators present a fertile ground for young ventures. The situation around the Chinese startup scene changed dramatically. With the current government’s Five-Year-Plan, it becomes obvious that the political change is in favor of those young individuals who bring jobs and new perspectives for the country. Obviously, the target is not to promote western startups to settle in China primarily but to give Chinese startups the inspiration through the foreign spirit. So the research question goes as follows: What aspects of a manufacturing project will influence the success of a foreign entrepreneur in China? The methodology for this study is widely based on literature review and semistructured interviews with entrepreneurs, consultancy agencies, and nongovernmental organizations. Whereas the focus lays on foreign startups whose goal is to set up manufacturing of a consumer product in China.

This is an in-depth study of the structural change and transition of the Chinese consumer goods market from 1954 to 1991 using disequilibrium econometric methodology. The model for the Chinese consumer goods market is based on the Portes-Winter disequilibrium model for centrally planned economies (1980). The demand function is derived from the Houthakker-Taylor savings function. The supply function is composed of approximations to the government's long-term and short-term plans. The transaction quantity in the market is defined as the smaller of effective demand and supply. Using the traditional global fitting method, three models are evaluated: one model that assumes no structural change, and two models that assume structural change. The estimations show that the structures of the demand and supply functions of the Chinese consumer goods market have changed since the economic reform in 1980. An innovative non-parametric method of locally weighted optimization is applied to further test the variations in model parameters during the period between 1954 and 1991 without assuming explicit functional forms of demand and supply. The estimation results show that the Chinese consumer goods market fits the Portes-Winter model well in the earlier years. The results confirm that the structures of demand and supply functions have changed since the economic reform. In the late 1980's, the Chinese consumer goods market is shown to have shifted away from a pure centrally planned system. Other main conclusions of this study include, first, that chronic shortage does not exist in the Chinese consumer goods market from 1954 to 1991. Second, a rigid price level has not caused the market to be persistently in disequilibrium. Third, the classical disequilibrium model of consumer goods market in centrally planned economies does not fit the Chinese consumer goods market in the later years.

Thesis (M.A.)--City University of Hong Kong, 2007.<br>Title from PDF t.p. (viewed on Sept. 7, 2007) "Master of Art in arbitration and dispute resolution LW6409 dissertation" Includes bibliographical references.

<p>The purpose of this thesis is to investigate the behaviour of young Chinese girls toward luxury goods and to provide suggestions for the marketer when marketing products on the Chinese market.</p><p>The goal of this study was to see the differences in behaviour between the area of Hong Kong, Taiwan and China (Mainland), but also to identify toward which categories of luxury goods (perfume, leather goods, clothing) people were more favourable.</p><p>In order to get information for our thesis we used a qualitative approach (by doing a focus group) and a quantitative approach (by using questionnaire). Our sample can be described as girls aged from 20 to 25 and living in the area of Honk Kong, Taiwan and China (Mainland)</p><p>To retrieve information we focused on different variables intervening in the consumer behaviour such as perception, learning and memorisation, motivation and attitude. We investigate perception through, knowledge, symbolism and risks perceived, the learning and memorisation process were evaluate through information , the motivation and attitude were measured through the intention to buy.</p><p>As a result of this study we find out some similarities in behaviour in the different geographic areas investigated. These findings can lead to the glob-alization of some specific points of the marketing mix. However great dif-ferences between the regions also appeared and they should be taken in consideration in the marketing strategy in order to be successful.</p>

Conventionally, efforts of combating climate change mainly focus on reducing emissions at production sources, such as factories, offices or other organizational-based entities. While this approach has served its purposes for years, the environmental impacts of consumer goods, which cause cross-border carbon emission are very difficult to be managed. This study investigated the feasibilities of an alternative solution to combat climate change using the concept of product carbon footprint (PCF) labelling in Hong Kong. PCF describes the total set of greenhouse gases caused by a product over its whole life cycle, from raw material extraction to disposal. The concept of PCF is prevalent in regions such as Europe, Japan and Taiwan, where PCF information is shown as labels on products’ packaging to help consumers distinguish more eco-friendly products. These PCF labels, based on overseas pioneer experience, have shown enormous market potential and environmental benefits. Hong Kong has yet to establish such labelling system despite these benefits. The aim of the study is to investigate the feasibilities of introducing PCF labelling in Hong Kong and identify the opportunities and difficulties lie ahead. Five main types of feasibilities, namely technical, economic, legal, operational and scheduling feasibilities were considered in the study and in-depth review was carried out on each one. Literature review, questionnaire for general public and interviews with stakeholders were undertaken to understand existing PCF labelling schemes and obtain first-hand information from stakeholders of different perspectives. By analyzing the questionnaire and interview results, the study revealed that short-term feasibilities of introducing PCF labelling in Hong Kong is medium. Recommendations were made in accordance to each type of feasibilities to promote the wider adoption of PCF labelling in the future.<br>published_or_final_version<br>Environmental Management<br>Master<br>Master of Science in Environmental Management

As the Chinese luxury market has become one of the biggest in the world, this thesis seeks to investigate the relationship between the luxury perception of Chinese consumers and their willingness to buy under the price reduction. Drawing from Wiedmann’s concepts of luxury values, we propose a framework to measure the luxury value perception of Chinese consumers through the functional, individual, and social dimensions.   We conduct a quantitative research and collect 315 valid questionnaires from Chinese luxury consumers. In questionnaires, we ask them to rate the perception of luxury goods and their willingness to buy when the price is reduced by 20% and 40% respectively. We perform multiple linear regression with SPSS. The results show the value perception in the individual dimension has positive impact on the willingness to buy, and the more price is reduced, the more impact it will have, whereas, the value perception in the functional dimension is not significantly related to the willingness to buy under both price reductions. The value perception in the social dimension is positively related to the willingness to buy when the price is reduced by 20%, but there is no significant relationship when the price is further reduced by 40%.

In order to take advantage of the global economy, manufacturing companies have developed a complex and an extended supply chain which includes manufacturing components or parts in LCCs (low-cost countries) and shipping them to factories near to their consumer market for final assembly, customization and distribution. These activities involve several different organizations that follow widely different approaches in logistical management. In order to sustain the long shipment distances in different geographic regions, (i.e. China-Mexico-US-Europe), handling &amp; environmental conditions &amp; shipping modes (Air vs Ground vs Sea); suitable, flexible and economical packaging solutions are required. This flow of semi-finished goods usually requires packaging materials such as carriers (i.e. wooden pallets) and moisture inhibitors (i.e. desiccants) to protect the goods. Competitive pressures, environmental consciousness, customer awareness and legislative requirements have driven manufacturers to review business practices and redesign solutions that are environmentally friendly, as well as help reduce costs in the long run. The author of this paper will present an experience where "non-traditional" packaging is used as an economical and environmental friendly solution to globally transport goods between multiple facilities.

Covid-19 pandemic has spread to the whole world from Wuhan, China in December, 2019 and seriously changed the daily life. While various measures have been taken to fight against the global pandemic in the whole world, transformations have occurred in business manners in many countries including Turkey. The public relations sector, which is an applied communication discipline managing the communication processes between the organization and target audience, has been affected by this process. Thus, how the pandemic period has affected the business manners of agencies and how the public relations profession has been actualized in agencies have been an object of interest. The main question of this study is how the pandemic period has affected the organizational culture in public relations agencies, and will these effects cause permanent changes in business manners in the agencies after the pandemic. The fact that most people have started making grocery shopping online due to Covid- 19 has increased the share of e-trade in the sector of Fast Moving Consumer Goods (FMCG), which are also known as packaged consumption products. Public relations agencies serving in this sector have accelerated their communication activities especially during the pandemic. A semi-structured interview technique was applied to the representatives of seven public relations agencies serving in the fast moving consumer goods sector within the framework of the questions formed in line with the factors affecting the corporate culture according to Mondy (communication, motivation, leadership, management process, organizational structure and management style) in this study. The study found that hybrid working order (telecommuting/office working) was adopted by agency employees, the concept of office hours disappeared in agencies, the service process became 24/7 by the agency, digital communication tools accelerated the communication processes, and the business capacity of agencies increased. It is observed in line with these factors that pandemic period has caused both positive and negative permanent behavioral changes in the organizational culture of agencies.

Smart assembly is a term that is being used to describe the concept of integration of virtual and real time tools and methods to achieve gains in productivity, lead time, quality, and agility in the manufacturing arena. This paper describes efforts and successes in planning and implementing a laboratory to teach undergraduate engineering students these tools and allow for applied research. Between 1973 and 2004 the percentage of goods consumed in the US that are produced in the US has dropped from 83% to 24%. Much of this decrease has been driven by globalization. Goods can be manufactured for 30 to 50% less in China, for example, than in the US. This poses a very real threat to the manufacturing base of the US. An alternative business model that places the production closer to the customer is gaining favor as at least partial solution to this problem. This model is driven by automation and systems engineering to decrease cost and increase flexibility. The lab at Oregon Institute of Technology will use a collection of small robots and standard material handling devices to model physical systems. Discrete event simulation programs will be developed that allow engineers to quickly and easily model changes. This project is a collaboration of the Manufacturing and the Computer Software Engineering Technology programs. It is being driven by a series of faculty and student projects.

The BeefLedger Export Smart Contracts project is a collaborative research study between BeefLedger Ltd and QUT co-funded by the Food Agility CRC. This project exists to deliver economic value to those involved in the production, export and consumption of Australian beef to China through: (1) reduced information asymmetry; (2) streamlined compliance processes, and; (3) developing and accessing new data-driven value drivers, through the deployment of decentralised ledger technologies and associated governance systems. This report presents early insights from a survey deployed to Chinese consumers in Nov/Dec 2019 exploring attitudes and preferences about blockchain-credentialed beef exports to China. Our results show that most local and foreign consumers were willing to pay more than the reference price for a BeefLedger branded Australian cut and packed Sirloin steak at the same weight. Although considered superior over Chinese processed Australian beef products, the Chinese market were sceptical that the beef they buy was really from Australia, expressing low trust in Australian label and traceability information. Despite lower trust, most survey respondents were willing to pay more for traceability supported Australian beef, potentially because including this information provided an additional sense of safety. Therefore, traceability information should be provided to consumers, as it can add a competitive advantage over products without traceability.

After decades of rapid economic development, China is quickly becoming the world’s second-largest transport energy consumer. Recently, it has also surpassed the United States (U.S.) as the world’s largest oil importer, and it is expected to become the largest oil consumer by the early 2030s.

1.1 Macroeconomic summary Economic recovery has consistently outperformed the technical staff’s expectations following a steep decline in activity in the second quarter of 2020. At the same time, total and core inflation rates have fallen and remain at low levels, suggesting that a significant element of the reactivation of Colombia’s economy has been related to recovery in potential GDP. This would support the technical staff’s diagnosis of weak aggregate demand and ample excess capacity. The most recently available data on 2020 growth suggests a contraction in economic activity of 6.8%, lower than estimates from January’s Monetary Policy Report (-7.2%). High-frequency indicators suggest that economic performance was significantly more dynamic than expected in January, despite mobility restrictions and quarantine measures. This has also come amid declines in total and core inflation, the latter of which was below January projections if controlling for certain relative price changes. This suggests that the unexpected strength of recent growth contains elements of demand, and that excess capacity, while significant, could be lower than previously estimated. Nevertheless, uncertainty over the measurement of excess capacity continues to be unusually high and marked both by variations in the way different economic sectors and spending components have been affected by the pandemic, and by uneven price behavior. The size of excess capacity, and in particular the evolution of the pandemic in forthcoming quarters, constitute substantial risks to the macroeconomic forecast presented in this report. Despite the unexpected strength of the recovery, the technical staff continues to project ample excess capacity that is expected to remain on the forecast horizon, alongside core inflation that will likely remain below the target. Domestic demand remains below 2019 levels amid unusually significant uncertainty over the size of excess capacity in the economy. High national unemployment (14.6% for February 2021) reflects a loose labor market, while observed total and core inflation continue to be below 2%. Inflationary pressures from the exchange rate are expected to continue to be low, with relatively little pass-through on inflation. This would be compatible with a negative output gap. Excess productive capacity and the expectation of core inflation below the 3% target on the forecast horizon provide a basis for an expansive monetary policy posture. The technical staff’s assessment of certain shocks and their expected effects on the economy, as well as the presence of several sources of uncertainty and related assumptions about their potential macroeconomic impacts, remain a feature of this report. The coronavirus pandemic, in particular, continues to affect the public health environment, and the reopening of Colombia’s economy remains incomplete. The technical staff’s assessment is that the COVID-19 shock has affected both aggregate demand and supply, but that the impact on demand has been deeper and more persistent. Given this persistence, the central forecast accounts for a gradual tightening of the output gap in the absence of new waves of contagion, and as vaccination campaigns progress. The central forecast continues to include an expected increase of total and core inflation rates in the second quarter of 2021, alongside the lapse of the temporary price relief measures put in place in 2020. Additional COVID-19 outbreaks (of uncertain duration and intensity) represent a significant risk factor that could affect these projections. Additionally, the forecast continues to include an upward trend in sovereign risk premiums, reflected by higher levels of public debt that in the wake of the pandemic are likely to persist on the forecast horizon, even in the context of a fiscal adjustment. At the same time, the projection accounts for the shortterm effects on private domestic demand from a fiscal adjustment along the lines of the one currently being proposed by the national government. This would be compatible with a gradual recovery of private domestic demand in 2022. The size and characteristics of the fiscal adjustment that is ultimately implemented, as well as the corresponding market response, represent another source of forecast uncertainty. Newly available information offers evidence of the potential for significant changes to the macroeconomic scenario, though without altering the general diagnosis described above. The most recent data on inflation, growth, fiscal policy, and international financial conditions suggests a more dynamic economy than previously expected. However, a third wave of the pandemic has delayed the re-opening of Colombia’s economy and brought with it a deceleration in economic activity. Detailed descriptions of these considerations and subsequent changes to the macroeconomic forecast are presented below. The expected annual decline in GDP (-0.3%) in the first quarter of 2021 appears to have been less pronounced than projected in January (-4.8%). Partial closures in January to address a second wave of COVID-19 appear to have had a less significant negative impact on the economy than previously estimated. This is reflected in figures related to mobility, energy demand, industry and retail sales, foreign trade, commercial transactions from selected banks, and the national statistics agency’s (DANE) economic tracking indicator (ISE). Output is now expected to have declined annually in the first quarter by 0.3%. Private consumption likely continued to recover, registering levels somewhat above those from the previous year, while public consumption likely increased significantly. While a recovery in investment in both housing and in other buildings and structures is expected, overall investment levels in this case likely continued to be low, and gross fixed capital formation is expected to continue to show significant annual declines. Imports likely recovered to again outpace exports, though both are expected to register significant annual declines. Economic activity that outpaced projections, an increase in oil prices and other export products, and an expected increase in public spending this year account for the upward revision to the 2021 growth forecast (from 4.6% with a range between 2% and 6% in January, to 6.0% with a range between 3% and 7% in April). As a result, the output gap is expected to be smaller and to tighten more rapidly than projected in the previous report, though it is still expected to remain in negative territory on the forecast horizon. Wide forecast intervals reflect the fact that the future evolution of the COVID-19 pandemic remains a significant source of uncertainty on these projections. The delay in the recovery of economic activity as a result of the resurgence of COVID-19 in the first quarter appears to have been less significant than projected in the January report. The central forecast scenario expects this improved performance to continue in 2021 alongside increased consumer and business confidence. Low real interest rates and an active credit supply would also support this dynamic, and the overall conditions would be expected to spur a recovery in consumption and investment. Increased growth in public spending and public works based on the national government’s spending plan (Plan Financiero del Gobierno) are other factors to consider. Additionally, an expected recovery in global demand and higher projected prices for oil and coffee would further contribute to improved external revenues and would favor investment, in particular in the oil sector. Given the above, the technical staff’s 2021 growth forecast has been revised upward from 4.6% in January (range from 2% to 6%) to 6.0% in April (range from 3% to 7%). These projections account for the potential for the third wave of COVID-19 to have a larger and more persistent effect on the economy than the previous wave, while also supposing that there will not be any additional significant waves of the pandemic and that mobility restrictions will be relaxed as a result. Economic growth in 2022 is expected to be 3%, with a range between 1% and 5%. This figure would be lower than projected in the January report (3.6% with a range between 2% and 6%), due to a higher base of comparison given the upward revision to expected GDP in 2021. This forecast also takes into account the likely effects on private demand of a fiscal adjustment of the size currently being proposed by the national government, and which would come into effect in 2022. Excess in productive capacity is now expected to be lower than estimated in January but continues to be significant and affected by high levels of uncertainty, as reflected in the wide forecast intervals. The possibility of new waves of the virus (of uncertain intensity and duration) represents a significant downward risk to projected GDP growth, and is signaled by the lower limits of the ranges provided in this report. Inflation (1.51%) and inflation excluding food and regulated items (0.94%) declined in March compared to December, continuing below the 3% target. The decline in inflation in this period was below projections, explained in large part by unanticipated increases in the costs of certain foods (3.92%) and regulated items (1.52%). An increase in international food and shipping prices, increased foreign demand for beef, and specific upward pressures on perishable food supplies appear to explain a lower-than-expected deceleration in the consumer price index (CPI) for foods. An unexpected increase in regulated items prices came amid unanticipated increases in international fuel prices, on some utilities rates, and for regulated education prices. The decline in annual inflation excluding food and regulated items between December and March was in line with projections from January, though this included downward pressure from a significant reduction in telecommunications rates due to the imminent entry of a new operator. When controlling for the effects of this relative price change, inflation excluding food and regulated items exceeds levels forecast in the previous report. Within this indicator of core inflation, the CPI for goods (1.05%) accelerated due to a reversion of the effects of the VAT-free day in November, which was largely accounted for in February, and possibly by the transmission of a recent depreciation of the peso on domestic prices for certain items (electric and household appliances). For their part, services prices decelerated and showed the lowest rate of annual growth (0.89%) among the large consumer baskets in the CPI. Within the services basket, the annual change in rental prices continued to decline, while those services that continue to experience the most significant restrictions on returning to normal operations (tourism, cinemas, nightlife, etc.) continued to register significant price declines. As previously mentioned, telephone rates also fell significantly due to increased competition in the market. Total inflation is expected to continue to be affected by ample excesses in productive capacity for the remainder of 2021 and 2022, though less so than projected in January. As a result, convergence to the inflation target is now expected to be somewhat faster than estimated in the previous report, assuming the absence of significant additional outbreaks of COVID-19. The technical staff’s year-end inflation projections for 2021 and 2022 have increased, suggesting figures around 3% due largely to variation in food and regulated items prices. The projection for inflation excluding food and regulated items also increased, but remains below 3%. Price relief measures on indirect taxes implemented in 2020 are expected to lapse in the second quarter of 2021, generating a one-off effect on prices and temporarily affecting inflation excluding food and regulated items. However, indexation to low levels of past inflation, weak demand, and ample excess productive capacity are expected to keep core inflation below the target, near 2.3% at the end of 2021 (previously 2.1%). The reversion in 2021 of the effects of some price relief measures on utility rates from 2020 should lead to an increase in the CPI for regulated items in the second half of this year. Annual price changes are now expected to be higher than estimated in the January report due to an increased expected path for fuel prices and unanticipated increases in regulated education prices. The projection for the CPI for foods has increased compared to the previous report, taking into account certain factors that were not anticipated in January (a less favorable agricultural cycle, increased pressure from international prices, and transport costs). Given the above, year-end annual inflation for 2021 and 2022 is now expected to be 3% and 2.8%, respectively, which would be above projections from January (2.3% and 2,7%). For its part, expected inflation based on analyst surveys suggests year-end inflation in 2021 and 2022 of 2.8% and 3.1%, respectively. There remains significant uncertainty surrounding the inflation forecasts included in this report due to several factors: 1) the evolution of the pandemic; 2) the difficulty in evaluating the size and persistence of excess productive capacity; 3) the timing and manner in which price relief measures will lapse; and 4) the future behavior of food prices. Projected 2021 growth in foreign demand (4.4% to 5.2%) and the supposed average oil price (USD 53 to USD 61 per Brent benchmark barrel) were both revised upward. An increase in long-term international interest rates has been reflected in a depreciation of the peso and could result in relatively tighter external financial conditions for emerging market economies, including Colombia. Average growth among Colombia’s trade partners was greater than expected in the fourth quarter of 2020. This, together with a sizable fiscal stimulus approved in the United States and the onset of a massive global vaccination campaign, largely explains the projected increase in foreign demand growth in 2021. The resilience of the goods market in the face of global crisis and an expected normalization in international trade are additional factors. These considerations and the expected continuation of a gradual reduction of mobility restrictions abroad suggest that Colombia’s trade partners could grow on average by 5.2% in 2021 and around 3.4% in 2022. The improved prospects for global economic growth have led to an increase in current and expected oil prices. Production interruptions due to a heavy winter, reduced inventories, and increased supply restrictions instituted by producing countries have also contributed to the increase. Meanwhile, market forecasts and recent Federal Reserve pronouncements suggest that the benchmark interest rate in the U.S. will remain stable for the next two years. Nevertheless, a significant increase in public spending in the country has fostered expectations for greater growth and inflation, as well as increased uncertainty over the moment in which a normalization of monetary policy might begin. This has been reflected in an increase in long-term interest rates. In this context, emerging market economies in the region, including Colombia, have registered increases in sovereign risk premiums and long-term domestic interest rates, and a depreciation of local currencies against the dollar. Recent outbreaks of COVID-19 in several of these economies; limits on vaccine supply and the slow pace of immunization campaigns in some countries; a significant increase in public debt; and tensions between the United States and China, among other factors, all add to a high level of uncertainty surrounding interest rate spreads, external financing conditions, and the future performance of risk premiums. The impact that this environment could have on the exchange rate and on domestic financing conditions represent risks to the macroeconomic and monetary policy forecasts. Domestic financial conditions continue to favor recovery in economic activity. The transmission of reductions to the policy interest rate on credit rates has been significant. The banking portfolio continues to recover amid circumstances that have affected both the supply and demand for loans, and in which some credit risks have materialized. Preferential and ordinary commercial interest rates have fallen to a similar degree as the benchmark interest rate. As is generally the case, this transmission has come at a slower pace for consumer credit rates, and has been further delayed in the case of mortgage rates. Commercial credit levels stabilized above pre-pandemic levels in March, following an increase resulting from significant liquidity requirements for businesses in the second quarter of 2020. The consumer credit portfolio continued to recover and has now surpassed February 2020 levels, though overall growth in the portfolio remains low. At the same time, portfolio projections and default indicators have increased, and credit establishment earnings have come down. Despite this, credit disbursements continue to recover and solvency indicators remain well above regulatory minimums. 1.2 Monetary policy decision In its meetings in March and April the BDBR left the benchmark interest rate unchanged at 1.75%.

The internet and digital technologies are upending global trade. Industries and supply chains are being transformed, and the movement of data across borders is now central to the operation of the global economy. Provisions in trade agreements address many aspects of the digital economy – from cross-border data flows, to the protection of citizens’ personal data, and the regulation of the internet and new technologies like artificial intelligence and algorithmic decision-making. The UK government has identified digital trade as a priority in its Global Britain strategy and one of the main sources of economic growth to recover from the pandemic. It wants the UK to play a leading role in setting the international standards and regulations that govern the global digital economy. The regulation of digital trade is a fast-evolving and contentious issue, and the US, European Union (EU), and China have adopted different approaches. Now that the UK has left the EU, it will need to navigate across multiple and often conflicting digital realms. The UK needs to decide which policy objectives it will prioritise, how to regulate the digital economy domestically, and how best to achieve its priorities when negotiating international trade agreements. There is an urgent need to develop a robust, evidence-based approach to the UK’s digital trade strategy that takes into account the perspectives of businesses, workers, and citizens, as well as the approaches of other countries in the global economy. This working paper aims to inform UK policy debates by assessing the state of play in digital trade globally. The authors present a detailed analysis of five policy areas that are central to discussions on digital trade for the UK: cross-border data flows and privacy; internet access and content regulation; intellectual property and innovation; e-commerce (including trade facilitation and consumer protection); and taxation (customs duties on e-commerce and digital services taxes). In each of these areas the authors compare and contrast the approaches taken by the US, EU and China, discuss the public policy implications, and examine the choices facing the UK.

Although global inflation and commodity prices are on the rise, spillovers to consumer price inflation in the People’s Republic of China (PRC) are expected to be limited. Consumer price inflation in the PRC has been driven mainly by domestic factors during the past decade, while commodity price shocks that led to higher producer costs hardly affected consumer prices. Reasons for these developments include a consumer basket of domestic products, anchored inflation expectations, and system buffers to absorb commodity price shocks. Though contagion risks of higher global inflation and commodity prices to inflation seem limited, possible transmission channels include further rising commodity prices and a shift in inflation expectations in the PRC. This note aims at providing policy recommendations on minimizing inflation transmission channels and containing inflationary expectations.