Know the Perils of Consolidating Your Student Loans

There’s a lot of of college loans at hand for College Students who’s searching student aid to go to a University. A common college loan consolidation procedure countless students take is through the U.S. Government Federal Loan Program. A Free Application for Federal Student Aid (FAFSA) form must be filled out before a Student can be considered for a particular government student loan. There are also four types of government loans namely, Graduate PLUS Loan, Parent PLUS Loan, Perkins Loan and the Stafford Loan. With innumerable websites and supposedly experts in the media, it is imperative that a Student obtain the most up-to-date student loan consolidation advice they can get.

Merging your loans can be critical for Students to get their financial situations under control. Student loan consolidation simply means the act of obtaining one loan to pay off all the others, thus creating one loan where a Student or the Parents may have had 2 or more loans to pay off. Government consolidation can make a borrower choose from the four repayment procedures like the extended payment plan. Merging your student loans generally results in a lower monthly payment with no penalties included for the early paying off of the loan.

Furthermore, in most cases, there is no credit check needed in consolidating your government student loan thus this may result in a lower interest rate. And also, if a government loan is consolidated its application process will be a lot simpler. Parents or Students with Private loans will want to weigh the pro’s and con’s of private consolidation before taking action.

Consolidating your loan may decrease your monthly payment and string out the repayment term longer. This helps many students get on their feet and obtain a good paying job so that repaying their student loan doesn’t put them into financial hardship.

One needs to know the pitfalls associated with student loan consolidation before taking action. This plan of action is not a good choice for everyone. There are pitfalls to consolidation, many of which no one is willing to educate the Student about.

Some students consolidate their loans then do nothing to improve their financial status. Then when it comes time to repay, they are financially strapped due to having to repay their student loan.

Consolidating your government college aid during the six month grace period will result to the loss of the rest of the grace period. Furthermore, a consolidated loan means an extended payment plan which can cause a the total amount to be paid back to be raised as time goes by. As a matter of fact, the total amount paid back may reach thousands of dollars in cost. Thus, sometimes, consolidation may not be convenient and cost-effective.

Government student loans are truly a gift for students who are in need of financial aid. However, consolidating it may or may not have a positive effect on your long term financial situation. Thus, a wise Student will review all of his or her options before consolidating their aid packages and do diligent research to make sure student loan consolidation is right for their financial circumstance.

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The Pros and Cons of Private Student Loans

College students are often cautioned to avoid private loans unless absolutely necessary, urged instead to take advantage of all other financial aid options first.

The advice is sound. Generally speaking, private student loans, which are offered by banks, credit unions, and other private lenders, don’t offer the same level of borrower protections and benefits that government college loans do.

As a student, you should seek out grants and scholarships first — money for college that you won’t have to repay — before taking on college loan debt. Then, if you’re still going to need college loans, you should, in general, make sure you’ve maximized all your available government loans before you consider taking out a private student loan.

Interest Rates & Repayment Options

Federal education loans have fixed interest rates and more flexible repayment terms than private loans. The Department of Education offers income-based repayment options that keep your monthly payments at a figure you can afford, repayment extensions to give you more time to repay, and loan deferments and forbearances that can temporarily postpone your college loan payments if you’re facing financial hardship.

If you go to work in the public sector, you may also be eligible for the discharge of some or all of your government loan debts.

With private student loans, on the other hand, your interest rate is almost always variable, and private lenders aren’t required to provide the kind of repayment flexibility that comes standard on federal college loans.

The current foreclosure crisis that began mushrooming, in part, because of adjustable-rate mortgages should be enough to make anyone leery of adjustable-rate loans on anything.

But it’s worth keeping in mind that when interest rates are low, as they are now, adjustable-rate private student loans can have a lower interest rate than their fixed-rate federal counterparts.

If you have excellent credit, or if you have a parent or co-signer with excellent credit, you may qualify for the lowest-rate private college loans, which currently carry interest rates that are as much as 3-percent to 6-percent lower than the rates on federal student and parent loans.

Interest rates are destined to rise as the economy continues to recover from the recession, so private loan rates won’t always be this low, but if you or your parents are in a position to pay that private student loan off relatively quickly, you may be able to save money over a government-issued college loan.

Covering Your College Costs

So why take out a private student loan at all?

Private student loans are meant to “fill the gap” in college funding that may be left after you reach your federal student borrowing limits. In many cases, families find that scholarships and federal financial aid simply aren’t enough to cover the rising cost of college.

Without private student loans, you may not be able to pay for college or continue your studies.

Statistically, college graduates have a better chance of being gainfully employed than non-graduates do, and college graduates, on average, earn more money in their jobs than workers who don’t have a college degree. For you as a college student, better job and salary prospects may make the burden of a reasonable amount of private student loans easier to bear.

Working With Private Student Loan Lenders

College loan companies aren’t deaf to the economic realities that college graduates are facing. Recently, some of the largest private student loan lenders have instituted new guidelines for the repayment and forgiveness of college loan debt.

Wells Fargo and Sallie Mae, for example, both announced this year that they would begin discharging private student loans upon the death of the borrower. Beforehand, that debt was being left to the co-signer to repay.

And as the recession and large swaths of unemployment among recent college graduates has led to higher rates of delinquency and default on college loans, some private lenders have shown a slight uptick in their willingness to work out modified repayment plans with troubled borrowers who are unable to repay their private student loans.

Being a Smart Student Borrower

For students who must turn to private education loans, it pays to shop around. Interest rates are always important, but they aren’t the only factor worth considering. Repayment policies, payment deferral options, default and late-payments penalties, interest-rate caps, and other terms may give some private student loan programs a clear advantage over others.

Always be mindful of the total amount of your debt from all sources, school loans and otherwise, and aim to limit your reliance on college loans, both federal and private.

The Department of Education’s National Student Loan Data System can help you track all your federal loan debt. Additionally, if you’re carrying debt from multiple federal college loans, the Education Department’s student loan debt consolidation program can help simplify the repayment process and may lower your monthly loan payments.

As you begin to repay your school loans, make it a priority to pay off the higher-interest loans first.

By taking advantage of college scholarships, using all your federal financial aid options, and minimizing the amount of debt you take on to pay for school, you can benefit from the careful and limited borrowing of private student loans to help pay for your college education.

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All About Federal Student Loans

Federal student loans are a great way for students to provide financial assistance for their education. Federal student loans are often considered to be safe and secure mode of financial assistance. These federal loans have many benefits and is available at both undergraduate and graduate students. Many countries, including Australia, USA, UK, India and other countries providing the loans federal student financial assistance or welfare programs for students in schools or higher education.

Federal student loans generally have lower interest rates, many mortgage options with flexible payment options and the loan assistance to students seeking funding for education. For most cases, a federal student loan can be a very economical for higher education. There are websites like federal student finance that lists all aspects of federal student loans and therefore are useful for students to get all the useful information they need student loans or financial assistance.

Types of Federal Student Loans

There are two types of student loans, which are federal loans and private student mortgages. Some of these loans are for parents of students for their financial needs. Each of these types of loans are aimed at different people and depends on several factors, such as region or courses taken. The types of federal student loans are -

Federal Stafford

These loans are granted by the federal government or any third-party educational organization. These loans are given on the student’s financial need and may be issued by a bank or credit union or any of the government offices. They have excellent payment options and so the student can study at home without having to worry about financial problems. Stafford Loans can be subsidized those who do not pay interest until the time of leaving the college / school or who may be eligible where they have to pay interest on the loan amount from the time they are disbursed.

Federal PLUS

These loans are given to parents whose children are conducting their training courses at their respective schools or colleges. The loan, the more you give on the basis of credit history or rating and the cost of attendance. The Federal PLUS Loan has a low interest rate and easy repayment options have payment and usually begins within 60 to 90 days after disbursement of the loan.

Federal Perkins

These loans are usually granted to students with high financial need and also gives bright and deserving students. These loans have very low interest rate payment options with good and easy. A financial adviser can tell you if you qualify for a federal Perkins loan or not you can check for a Federal Perkins Loan. But anyone who is not in case of default in payment of federal Perkins loans, as you may damage his / her credit rating seriously. Federal Perkins Loan is determined by factors such as time of application, the level of funding and the funding level of the school / college.

Rates of federal SL Interest

The interest rate on federal loans are lower compared to private student loans are interest rate is usually fixed. Interest rates of different types of federal mortgage, like Stafford or Perkins credit is different. Such as interest rate Federal Perkins Credit is smaller than other types of loans, but it is difficult to obtain. They have many benefits such as easy payment options and a longer holiday redemption and payment in installments that can be subsidized or unsubsidized.

Benefits of Federal SL Federal student loans have many advantages over private mortgages or otherwise. Federal mortgage can be consolidated with other types of loans to one loan that would be a single interest rate and the student will pay the single consolidated loan. It reduces the hassles of managing various loans and the payment of different types of loans. The federal loan consolidation is very useful for students and parents with many of the loans. Some of the benefits and advantages of federal student loans is given below.

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Finding a Student Loan Without a Cosigner

Finding a student loan without a cosigner these days is getting harder and harder. Banking institutions are more picky than ever about the kind of people they are willing to lend money to, and really- who can blame them? This has been a rough few years for the financial industry, and they have to protect themselves now. The problem comes when they start protecting themselves from people like you- students who need money to reach their education and career goals, and who have no real income because of their place in the educational journey.

The process of getting a student loan is made easier if you have a co-signer to help you, but not every student has access to a reliable family member or friend with a credit score high enough to be a cosigner. If a parent has bad credit score can not get college loan. Other students have eligible people available, but do not want to risk embarrassment or awkwardness by admitting a need for help. Other students just don’t have the kind of relationship with plausible cosigners to ask them for that kind of help.

If you are a student in any of these situations, then do not give up hope yet. There are still options out there for students with no cosigner. Finding a student loan without a cosigner is possible. This article will give you a few tips you can follow and a few links you can check out to help you find a student loan without a cosigner.

1. The FAFSA

Chances are this is not the first time you have heard FAFSA mentioned. The FAFSA, or the Free Application For Student Aid can be a really huge resource and help for students like you looking for a student loan without a cosigner. The FAFSA takes a while to fill out, which is why many students want to skip this step, but that would be a mistake. The FAFSA can tell you what grants and scholarships are available to students in your particular situation. It can also open up new student loan opportunities- many of them being college loans that do not need cosigners.

The FAFSA can also give you important information about all the different financial aid options that are available to you like is a student loan an installment on credit, or how many credits do I need to get financial aid?

The other great thing about filling out your FAFSA is not only that it is free, but that there are more than likely people hired at your school to specialize in this document. Many colleges have student aid facilities where people are paid to help students just like you fill out the FAFSA properly and get the financial aid they need to be successful. Find these individuals and take advantage of the wonderful gift your college has made available for you. Filling out the FAFSA is a great step towards finding a student loan without a cosigner.

2. Government Loans

There are a number of government loans available right now. Many students pass over these loan options because they do not give out very much at a time. The truth is, no government funded loan will give you all the money you need for a semester unless you also have some kind of scholarship. However, even if $2,000 from a Perkins loan won’t pay all your bills, it is $2,000 more than you would have had without the Perkins loan, and that is no small drop in the bucket. Plus- they are all offered without cosigners. Here are some of the government loans we think you should look into:

Subsidized Stafford Loan: This is the best government loan out there for students. It is a student loan without a cosigner. It is a student loan without a credit check. It is a student loan without hefty interest payments because it has been subsidized. Apply for a Stafford Loan, and you will almost certainly qualify for a student loan without a cosigner.

Unsubsidized Stafford Loan: This is the same as the previous no cosigner student loan except that the interest is not subsidized, so you will pay out more over the life of the loan than the subsidized loan.

Perkins Loan: These loans are great and easy to apply for, but are not as popular as they have a cap on the amount they can give both per year, and overall. They are a no credit check student loan and a student loan without cosigner- so definitely something to look into.

In the end- all of these loans can get you what you need without a student loan cosigner and student loan no credit checks Canada or US, but all of these loan options can give you more money if you have a co-signer. If you have simply been afraid to ask someone to take a risk on you, then you will want to have them look into these loans as they are much less risky and the interest rates are much lower than the student loans you will find at a bank.

Look For Local Boosters

If you are going to college, then you are most likely living in a college town. Here is a little secret about college towns- they NEED college students! They love you. Local businesses thrive off of you. Local housing owners survive by you. The population of the town you live in might complain heavily about all the noisy college goers- but they need you, and this makes for a lot of local boosters and scholarship opportunities. Look around for local opportunities to get supported through school. The average student with poor credit needs $7,000 loan per semester to get through school. Many need more, depending on the school, area, and situation of the student. A good way to get a head start on that $7,000 is to get help from the local businesses that need your presence to survive.

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The History of Student Loans in Bankruptcy

Student loans are basically non-dischargeable, almost everyone knows this. There are some very specific circumstances where even today you can have your student loan debt discharged, but that is a narrow exception that often requires a fight and money to fight. We will discuss the current state of dischargeability in a future post.

The landscape around student loans and bankruptcy has not always been so desolate. Not so long ago these loans were dischargeable. Back when they were dischargeable, the cost of an education was much lower and the total student loan debt was a fraction of what it is now. With student loan debt currently being a 1,200,000,000,000.00 (One Trillion Two Hundred Billion) dollar problem holding people back from purchasing homes or taking part in the broader economy, with a little help they may become dischargeable yet again.

A Brief History.

Student loans really did not pop into existence in America until 1958 under the National Defense Education Act. 1. These loans were offered as a way to encourage students to pursue math and science degrees to keep us competitive with the Soviet Union. 2. In 1965, the Guaranteed Student Loan or Stafford Loan program was initiated under the Johnson Administration. Over time, additional loan programs have come into existence. The necessity of loans for students has become greater as the subsidies universities receive have fallen over time. Take Ohio State for example. In 1990, they received 25% of their budget from the state, as of 2012 that percentage had fallen to 7%. In the absence of state money, universities and colleges have increased tuition to cover the reduction in state money.

The Rising Cost of Education.

The cost of higher education adjusted for inflation over time goes something like this, in 1980 the average cost for tuition room and board at a public institution was $7,587.00 in 2014 dollars and by 2015 it had gone up to $18,943.00 in 2014 dollars. The cost of a higher education in 35 years with inflation accounted for has gone up by 2.5 times. Compare this to inflation adjusted housing costs which have remained nearly unchanged, increasing just 19% from 1980 to 2015 when the bubble and housing crisis is removed. 3. Or compare to wages which, except for the top 25%, have not increased over that same time period. Looking at affordability in terms of minimum wage it is clear that loans are more and more necessary for anyone who wants to attend university or college. In 1981, a minimum wage earner could work full time in the summer and make almost enough to cover their annual college costs, leaving a small amount that they could cobble together from grants, loans, or work during the school year. 4. In 2005, a student earning minimum wage would have to work the entire year and devote all of that money to the cost of their education to afford 1 year of a public college or university. 5. Now think about this, there are approximately 40 million people with student loan debt somewhere over the 1.2 trillion dollar mark. According to studentaid.gov, seven million of those borrowers are in default, that is roughly 18%. Default is defined as being 270 days delinquent on your student loan payments. Once in default, the loan balances increase by 25% and are sent to collections. The collections agencies get a commission on collected debt and are often owned by the very entity that originated the loans, i.e. Sallie Mae.

The Building of the Student Debt Prison.

Prior to 1976 student loans were dischargeable in bankruptcy without any constraints. Of course, if you look back at statistics from that time, there wasn’t much student debt to speak of. When the US Bankruptcy Code was enacted in 1978, the ability to discharge student loans was narrowed. Back then, in order to have your loans discharged, you had to be in repayment for 5 years or prove that such a repayment would constitute an undue hardship. The rationale for narrowing the discharge was that it would damage the student loan system as student debtors flocked to bankruptcy to have their debt discharged. The facts, however, did not support this attack. By 1977 only .3% of student loans had been discharged in bankruptcy. 6. Still, the walls continued to close on student debtors. Up until 1984, only private student loans made by a nonprofit institution of higher education were excepted from discharge. 7. Next with the enactment of the Bankruptcy Amendments and Federal Judgeship Act of 1984, private loans from all nonprofit lenders were excepted from discharge. In 1990, the period of repayment before a discharge could be received was lengthened to 7 years. 8. In 1991, the Emergency Unemployment Compensation Act of 1991 allowed the federal government to garnish up to 10% of disposable pay of defaulted borrowers. 9. In 1993, the Higher Education Amendments of 1992 added income contingent repayment which required payments of 20% of discretionary income to be paid towards Direct Loans. 10. After 25 years of repayment the remaining balance was forgiven. In 1996 the Debt Collection Improvement Act of 1996 allowed Social Security benefit payments to be offset to repay defaulted federal education loans. 11. In 1998, the Higher Education Amendments of 1998 struck the provision allowing education loans to be discharged after 7 years in repayment. 12. In 2001, the US Department of Education began offsetting up to 15% of social security disability and retirement benefits to repay defaulted federal education loans. In 2005, “the law change” as we call it in the Bankruptcy field further narrowed the exception to discharge to include most private student loans. Since private student loans were given protection from discharge in bankruptcy there has been no reduction in the cost of those loans. 13. If the rational for excepting student loans from discharge is that the cost to students to obtain loans would soar, this fact would seem to lay waste to that argument.

In the wake of the slow march towards saddling our students with unshakable debt, the government created a couple of ways to deal with government backed student loans outside of bankruptcy. In 2007 the College Cost Reduction and Access Act of 2007 added income based repayment which allows for a smaller repayment than income contingent repayment, 15% of discretionary income and debt forgiveness after 25 years. 14. In 2010, the Health Care and Education Reconciliation Act of 2010 created a new version of income-based repayment cutting the monthly payment to 10% of discretionary income with debt forgiveness after 20 years. 15. This new improved income based repayment plan is only for borrowers who have no loans from before 2008. Further, those with loans in default, will not qualify for income based repayment unless they first rehabilitate those loans. If you are interested in seeing if your loans qualify for income based repayment or income contingent repayment please visit student aid dot gov. Unfortunately, none of these programs do anything to deal with private loans, a growing problem currently at around $200,000,000,000.00 (Two Hundred Billion) or around 16% of the total student loan debt.

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The Unintended Consequences of Globalism

Globalism might be good for the world economy as a whole, but does not necessarily mean it has been good for the American worker. Whether intentional or unintended, the American worker has suffered through the philosophy of free trade. Do not miss quote me, Globalism has a lot of positives. Now more than ever the people of earth are connected through the internet and can communicate information faster than any other time in history. People are exposed to different cultures and ideas, and the free flow of information is exponentially evolving our society. “Free trade” plays a big part in globalism, which is why there has been a “backlash” from non-college educated workers in wealthy countries in direct response to the effects of free trade policies. When wealthy counties openly trade with developing countries it can overvalue the wealthy countries currency, which in turn makes imports cheaper while exports become more expensive. However, according to the Economic Policy Institute, the real culprit is not the valuation of the dollar and the increasing trade deficit. (Bivens, Economic Policy Institute)

The USA has increasingly shifted its economy from manufacturing to services like banking and investing. It is cheaper to import products of manufacturing from a country that has extremely cheap labor than it is to employ American workers in the United States. This in turn means there now is a premium on college educated Americans who are filling job openings within the service industry. On the other side of the coin, manufacturing jobs are leaving the country and lowering wages of workers without a college degree. This fact coupled with increasing technology that replaces workers and a trade policy that out prices “expensive” American workers is leading to decreased wages. As the US trades more with developing countries as a percentage of GDP, the wages of unskilled workers continue to decrease. (Slaughter and Swagle, International Monetary Fund)

Though Globalism has a net increase in GDP and employment for countries involved, most of the gains from free trade is disproportionately received by the top 1% of Americans. Policies that protect corporations and their interest at the expense of the American worker exacerbate the problem. Trade policies like NAFTA and others have little protections for workers and heavily favor the multinational corporations that seek to benefit from free trade. This only adds fuel to income inequality, which for poor countries can increase economic growth while having a negative effect on rich countries. Rich countries are also at higher risk of financial crisis when they have high levels of income inequality. (Malinen, Huffington Post)

Globalism and free trade are linked very close together, which is why there is a stigma attributed to the word. There has been growing resentment within the US and other wealthy nations of globalism as a whole. They do not just condemn free trade, but openly blame minorities and marginalized groups for their decrease in wages and “eroding” their cultural dominance that they claim dominion over. This is a deadly cycle, as income inequality only feeds this type of behavior. In a country that is not adequately educating its people, more of the workers within its country will become more ignorant. With free trade putting a premium on college educated workers and decreasing wages of unskilled labor, we are now almost at a tipping point, socially and economically.

Globalism has many unintended consequences that inadvertently caused huge social and economic problems within the US. The problems that globalism is causing is not a hard fix. Reducing the income inequality will eradicate more of the negative effects of globalism. Universal Education, Universal healthcare, and a rewrite of our tax code are just a few ways to reduce income inequality. All of these possibilities are well within our means. We have to take care of these problems swiftly, before globalism becomes an integral part of our own decline. (Mason, Post-Gazette)

Bivens, Josh. “Using Standard Models to Benchmark the Costs of Globalization for American Workers without a College Degree.” Economic Policy Institute. N.p., 22 Mar. 2016. Web. 25 Apr. 2017.

Malinen, Tuomas. “The Economic Consequences of Income Inequality.” The Huffington Post. TheHuffingtonPost.com, 17 Dec. 2015. Web. 25 Apr. 2017.

Mason, Bob. “Single-payer Health Care Would Help to Treat Three Separate Threats.” Pittsburgh Post-Gazette. N.p., 26 Oct. 2014. Web. 25 Apr. 2017.

Slaughter, Matthew, and Phillip Swagel. “Economic Issues 11–Does Globalization Lower Wages and Export Jobs?” International Monetary Fund. Imf.org, Sept. 1997. Web. 25 Apr. 2017.

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Global Trends in the Cosmetic Industry

Cosmetic dyes and colours: Explained

Cosmetic colours are also known as cosmetic lakes. These colours are produced by taking the help of absorption of dyes that are water-soluble onto a substrate. It makes the colour insoluble in water. Cosmetic lake colours are made by making use of unique technology. The technology helps in attaining extremely fine particles. These particles help in achieving shade consistency. In comparison water soluble colours, cosmetic lakes are much more stable & safe. They also generate vivacious and brighter colours. It has been seen that cosmetic pigments and lakes are more suitable for food products that contain fats and oils. They are also suitable for those products that do not contain enough moisture for dissolving colours.

Cosmetic dyes, on the other hand are used for making cosmetic colours & products. These dyes are widely used by the cosmetic manufacturing industries and businesses all over the world. They are primarily used for manufacturing hair dyes, lipsticks, nail polishes, shampoo as well as other personal care products. It has been seen that generally water soluble & food dyes are very easy and safe to use. These dyes are mostly used for a wide variety of applications. They include cleaning chemicals, soaps, medicine, cosmetic products etc.

Know which ones are safe for use

Be it the use of any type of cosmetic dyes or cosmetic colorants safety of use is a primary consideration. Cosmetic colours and cosmetic dyes often make use of a wide range of synthetic colours. These are often referred to as FD&C colours. They are mainly extracted through coal tar and are basically a by-product of petroleum. Research shows that some particular coal tar based dyes lead to different types of cancer. This is why the FDA regulates them. They also determine the arsenic or lead amount they contain. Thus there are many restrictions in the use of such colours.

Some global trends in Cosmetic dyes and cosmetic colours

Worldwide it is seen that North America, followed by Europe, has the largest market for colour cosmetics. This is due to innovations in colour cosmetics. Other factors also include high consumer disposable income and frequent new product launches in colour cosmetic market in the region. However Asia too is expected to show high growth rate in the colour cosmetics market in next few years. This is on account of the increasing consumer incomes and rising in awareness about personal care products in the region.

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Economic Turmoil and the Future of Brazil

For many years, Brazil has been an emerging economic hub, attracting investors from all over the world. The Brazilian economy saw an 368% increase in Gross Domestic Product growth from 2003 to 2011. In addition, Brazil took in almost half of Foreign Direct Investment flowing into South America during 2015. This doesn’t come as a surprise since it reigns as one of the major emerging national economies. However, Brazil has seen a recent economic downturn with increasing unemployment and a contracting GDP. In fact, the Brazilian government cut 2017 GDP expectations from 1.6% to 1% growth. Having been one the most lucrative foreign investments for governments to individual investors, what happened to the so-called “Country of the Future” and can Brazil regain its momentum?

Back in 2015, recession hit Brazil hard and the country is still struggling to get back on track. According to the CIA World Factbook, the economy contracted 32% from its peak in 2011 and unemployment reached a new high at 12.6% in 2016. Being based mostly on services, agriculture and oil, Brazil’s economy has a direct correlation with global demand. With global recession looming, Brazil is feeling the effects of a slow world economy.

Brazil is a top tourist destination offering beautiful beaches, a diverse culture and exciting festivals. However, with the world economy slowing down, people are less likely to travel abroad. Since the majority of the country’s GDP derives from the service industry, Brazil will not be able to rebound any time soon unless there is a major boost in consumer confidence.

The demand for Brazilian exports was slashed when its largest trading partner, China, entered into an economic slowdown of their own. The decrease in exports caused massive layoffs throughout the nation. The notorious economic downward spiral began by wary consumer spending as unemployment rose. Companies that tried to gain capital by borrowing in U.S. dollars found it difficult to pay back those loans as the Brazilian Real crashed 25% in the span of a year in 2015.

One of the major hits came from low oil prices and the corruption of Petrobras, a large oil company and Brazil’s largest source of investment. Brazil is major producer of oil, exporting $11.8 billion worth in 2015, according to the Observatory for Economic Complexity. OPEC delivered a major blow when the cartel decided not to cut oil production, causing oil futures prices to plunge. In order to cope with heavy losses, Petrobras was forced to sell off assets and halt future research and expansion plans.

As if things weren’t going poorly, Petrobras was also caught in a scandal with former Brazilian president Dilma Rousseff and other high office executives. From 2004 to 2012, the company had spent over $2 billion on bribes to politicians whom would allow the company to charge inflated prices for construction contracts. Now that the scandal has unfolded, Petrobras executives face jail time and the company as a whole is forced to pay billions in fines.

So what does the future hold for Brazil?

Although at the moment the future looks dim, there are still signs of hope Brazil can turn itself around. The Real has seemed to stabilize in 2016 and heads into 2017 with an upward trend. Moreover, experts’ GDP projections for 2018 through 2020 show promising figures that Brazil can restore pre-recession level growth.

Even more promising, U.S. companies are still showing faith in Brazil’s future. American Airlines plans to invest $100 million in an aircraft maintenance center in Sao Paulo. Brazilian Investment Partnership Minister Wellington Moreira Franco and many countries like the United States, United Kingdom, France and Japan agree there are still reasons to invest in Brazil. This should be seen as a sign of confidence that the Brazilian market will grow soundly with the support of both national and international investment.

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The Effects Of The Global Trade Agreement

We live in a world that is increasingly getting connected. In such a world, trade agreements are bound to expand internationally, and to think and act otherwise would be downright stupid.

These global trade agreements, as such, are either bilateral or multilateral understanding between two or multiple countries and govern the trade policies between them. These agreements have a massive impact on worldwide trade and investments and are one of the major causes responsible for shaping business relationships across the globe. And while such agreements might not affect directly affect the place where you live or operate, being aware of the current trade agreements can definitely uncover numerous opportunities.

Forming up opinions is up to you; we do not intend to initiate an argument over how good or how bad these global trade agreements are. This article aims to get you familiarized with such agreements and tell if your supply chain could be affected or not.

While a few countries have settled upon free trade agreements and are in the process of widening them, a number of other nations have formed common markets and unions; this form of development can a have a thorough effect on small-scale businesses.

Two of the most common agreements are the Trans-Pacific Partnership (TPP) between Australia, New Zealand, Singapore, Canada, Brunei, Peru, Mexico, Chile, Malaysia and Japan, and the North American Free Trade Agreement (NAFTA) between Canada, United States and Mexico.

Now, how such agreements impact your local business’s supply chain depends on a simple fact; whether your business is an importer, exporter or neither.

Scenario 1: You neither import nor export

It’s fairly easy to decide whether you are an importer or not, right? I understand that you do not directly source products from a foreign supplier, and technically speaking, that doesn’t make you an importer. However, trade agreements can still impact you. Your suppliers are directly affected by such regulations, and this vulnerability can affect your supply chain.

Keep the distinction in mind.

Scenario 2: You identify yourself as an importer

Owing to the low cost manufacturing in some countries, many small scale suppliers are able to compete with global giants.

With a trade agreement between two countries, most of the times, the country with lower labour costs benefits when the trade tariffs are lowered or eliminated. With trade agreements, importers usually get to source low-cost goods and it allows for the unrestricted movement of such low-cost goods through higher cost partner nation.

In case, such an agreement is dissolved, an importer would inevitably face a higher cost of goods and thus look for cheaper sourcing options, decrease their operational costs, and ultimately increase the prices, which would be borne by the customers, of course.

Scenario 3: You are an exporter

This even counts if you sell products that another firm exports because at some point or other, taxes would be levied on your sold goods. So how does it affect you? Your customers end up paying higher amounts for your products.

With a trade agreement in place between the country where the product originates and the receiving country, the very same products would move through the receiving nation freely. In such cases, you’d definitely want to keep such an agreement intact and leverage this competitive advantage you have in this particular country bound by trade regulations.

As a small or a medium sized business, it is therefore important for you to identify where your business lies with respect to global trade agreements.

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The Paramounted Importance of Critical Analysis in International Trade Policies

International trade is largely based on the constant fluctuations in the world-wide economy, this resulting in constant changes with regards to tariffs, trade subsidies and unending amendments of regulations with regards to international trade. “Trade policy and economic Growth”, a paper by Keith Maskus, PhD, focuses on the relationship between trade policies and the growth of the economy or lack thereof, the main point of interest of the paper was to establish whether the variance of trade policies will affect the economic growth of any country. The conclusion reached was that open economies tend to grow faster than closed economies, ceteris paribus. therefore concluding that open competition is good in the sense that it improves resource distribution and the country gains in Investment and innovation.

An organisation that is involved in international trade has to pay special attention to such information. There might not be any countries with closed economies however there are countries that have low imports to the point that they are regarded as closed economies for instance Brazil. In 2011 Brazil recorded 13% as its import percentage which was quite low for a country of its stature. Is it not then imperative to constantly be up to date with changes in the trade policies of countries one is interested in pursuing trade relations with? since there is a proven positive relationship between the openness of an economy to competition (thus meaning the country is greatly involved in trade) and the growth of that country`s economy, this serves as an indication of how lucrative and profitable a business venture would be under such circumstances. The Critical analysis aspect then comes into play by determining how much gain or loss would result from substantial changes to the policies, which are measures and instruments that can influence export and imports, the objective being the policies influence the trade sector to the result of profit for the business venture. one might feel a degree in commercial management is then needed in order to fully understand all the kinks and edges of the international business, and they would be right, but the eventuality is that it will always boil down to intelligence and efficiency in the analysis of trends, calculation of potential profit/loss, predictions of future stability or fluctuations in the world economy prompting changes to prices in the trade sector.

There is one other important factor that can alter potential business plans, and that is the politics of the country in question, policies are easily influenced by the politics of the nation, and it is thus advisable that critical analysis be also engaged, this results in better understanding of the country and its stability thus reducing the chances of incurring a bad business eventuality. Nations are not governed by robots, unfortunately, but are governed by people with interests and human nature desires to differ from individual to individual making it difficult to maintain a constant effective system. if politicians are elected they tend to focus on altering policies for their own benefit, and the benefit of those they promised (if there are still honest politician available) from that point it is important that international business consider such factors before pursuing business. Prime examples being, whenever there are strikes in South Africa investors tend to shy away, and most of the strikes are birthed from political influence, thus deeming South Africa an Unstable nation to invest in, or Zimbabwe a nation sanctioned, due to political infringements, making the country undesirable for investment irregardless of the profitability of the business idea. It is thus an excellent idea to firstly research in-depth to the politics of the country before hand and invest with,much-needed information, guiding the innovative decision made.

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