(CNN) – Ten years after the Spanish currency, the peseta, was phased out, a rural town in Spain has revolted. Against the backdrop of the ailing euro, about 30 shops in Villamayor de Santiago last month began accepting the old currency, which was phased out in 2002 when Spain joined the eurozone.
According to Luis Miguel Campayo, chairman of the local merchant’s association, the move has been especially popular with older clientele, many of whom kept hold of old bills and coins in case the euro failed. "We wanted to persuade them to spend them," he told the Guardian. Shopkeepers have earned more than 1 million pesetas (about $7,900). Shopkeepers exchange the pesetas for euros at the Bank of Spain in Madrid.
The villagers in Spain are not alone. Currencies new and old have sprung up in towns in Italy, the UK, the U.S. and Mexico in the wake of the financial crisis and eurozone debt woes.
Zurich has overtaken Tokyo to rank as the world’s most expensive city for the first time in 20 years, according to the Economist Intelligence Unit's latest Worldwide Cost of Living Survey. The Swiss city was joined in the top five by Geneva, which rose to third place to tie with Osaka.
Whilst Switzerland has long been home to some of the priciest places to live, its upswing in the rankings can be attributed to the heavy investment in the Swiss franc, which is seen as a relatively safe currency outside of the embattled Eurozone, according to the report. Local price inflation in Switzerland has been low, but the report explained that "local inflation in mature markets always has far less influence on the relative cost of living than the currency movements of the countries in question."
Cities in the Asia-Pacific make up half of the top ten—in addition to Tokyo and Osaka, Sydney and Melbourne placed seventh and eighth, respectively, followed by Singapore. Seoul climbed 13 places over the last year to 27th place, and Chinese cities are also increasingly expensive, with Shanghai surpassing New York by two places to rank 42nd.
London (CNN) – It is official. The Greek economy has gone into meltdown.
The numbers released Tuesday show that during 2011 the economy contracted by 7%. Barclays estimates that much of that loss came in the last three months – when the economy dropped a whopping 5.1%.
A look at the IMF's World Economic Outlook puts it into context. In the darkest days of the recession no other developed country came close to suffering such a large loss (U.S. -2.4%; UK -4.9%; Eurozone -4.1).
It is now clear Greece's economy has fallen off a cliff. It has endured five years of grueling recession and every prospect of much more to come, as even the Greek prime minister warned that things would be tough for years to come.
(Hong Kong) – Could it be a coincidence that diplomats chose to schedule an annual meeting of Chinese and EU leaders on Valentine’s Day?
On Tuesday, two of the EU’s biggest hitters, Herman Van Rompuy, president of the European Council, and José Manuel Barroso, president of the European Commission, will meet with Premier Wen Jiabao in Beijing, before separate meetings with President Hu Jintao and Vice-Premier Li Keqiang. FULL POST
Davos, Switzerland (CNN) - To hear the European leaders in Davos you would think the eurozone crisis had only just occurred and there was an urgency to deal with it hitherto unforeseen.
German Chancellor Angela Merkel, British Prime Minister David Cameron and European economics commissioner Olli Rehn -– just about any leader in Davos - is now saying that time is of the essence –- that it is time to actually sort out the eurozone's problems. Forgive me. What on earth have the European leaders been doing and promising over the past three years?
It is strange that now as we enter a new year they believe 2012 is the right moment to actually take the necessary decisions and implement the changes. And yet they were saying similar things in 2011, in Davos. So it is entirely understandable if we are now skeptical that they have the willpower and ability to put things right. FULL POST
Davos, Switzerland (CNN) - The theme of this year’s World Economic Forum meeting in Davos is “the great transformation: shaping new models”. But this morning, at a WPP-organized breakfast about the world’s political outlook, it is the absence of a great transformation that is most clouding the world’s political outlook in 2012.
The breakfast, hosted with characteristic wit by WPP CEO Martin Sorrell, featured the political predictions of the American pollster Mark Penn and the British Labour Party impresario Peter Mandelson. But, in spite of the profound challenges to the global system, neither Penn nor Mandelson were able to conjure any great transformation in a world desperate for radical political reinvention.
The biggest party in America is “the no party,” Penn explained. The American electorate, he went on, is “fed up,” “angry” and “deeply pessimistic” about the future of the country. And yet, in spite of all this dissatisfaction, Penn sees the Republican primary race as a “circus,” is not optimistic about a third party candidate (unless Newt Gingrich unexpectedly wins the nomination,) sees little hope for a solution to the American budget crisis and expects Obama to be reelected in 2012.
London (CNN) – The World Bank is not an organization noted for hyperbole and exaggeration. Certainly the sober-suited Washington bankers don't usually go around the world forecasting calamity, unless it is to drum up more support for the disadvantaged and poor.
And that's why their comments surrounding the Global Economic Prospects for 2012 were so unusual. The bank has just downgraded growth estimates for this year, by the biggest amount in three years.
It forecasts the euro area will be in recession (-0.3 %) and developing nations will see growth at 5.4%, down from earlier forecasts of more than 6 percent.
(CNN) – The global research department of HSBC has released a report predicting the rise and fall of the world’s economies in the next 40 years.
The world’s top economy in 2050 will be China, followed by the United States. No surprises there – since China’s reforms in the 1980s, economists have said it’s not a question of if, but when, China’s collective economic might will top the U.S.
But among the smaller, developing nations, there are several surprises by HSBC prognosticators:
About Business 360
CNN International's business anchors and correspondents get to grips with the issues affecting world business, and they want your questions and feedback.