March 29, 2024

For Developing World, a Streamlined Facebook

Facebook soon plans to announce the first results of the initiative, which it calls Facebook for Every Phone: More than 100 million people, or roughly one out of eight of its mobile users worldwide, now regularly access the social network from more than 3,000 different models of feature phones, some costing as little as $20.

Many of those users, who rank among the world’s poorest people, pay little or nothing to download their Facebook news feeds and photos, with the data usage subsidized by phone carriers and manufacturers. 

Facebook has only just begun to sell ads to these customers, so it makes no money from them yet. But the countries in which the simple phone software is doing the best — India, Indonesia, Mexico, Brazil and Vietnam — are among the fastest-growing markets for use of the Internet and social networks, according to the research firm eMarketer.

Like many other giants of the technology industry, Facebook is struggling with the seismic shift of its customers away from computers to mobile devices and the erosion of profit that can bring.

Last year, the company overhauled its apps for Apple iPhones and Android-based smartphones to improve mobile access while introducing new types of ads that nudge users to install a new game or other apps on their phones. But customer growth in developed markets like the United States has still slowed markedly because just about everyone who wants to be on Facebook has already joined the network.

Analysts say Facebook has a powerful opportunity to win the long-term loyalty of millions of new global users by giving them their first taste of the Internet through Facebook on a simple cellphone.

“In a lot of foreign markets, people think that the Internet is Facebook,” said Clark Fredricksen, a vice president at eMarketer.

Those users, Facebook hopes, will become more attractive to advertisers as their incomes grow and they gain broader access to the Web.

The feature phone project was driven by a small group of people who joined Facebook in 2011, when it purchased a start-up called Snaptu. The team had to re-engineer Facebook’s software to drastically shrink the amount of data sent over slow cellular networks. They also had to find a way to quickly display familiar Facebook features like chat and photos on phones with very basic computing power and low-resolution screens.

“We actually run the apps on our servers,” said Ran Makavy, who was chief executive of Snaptu and now runs Facebook’s feature phone project. “The result was something that looks almost like a smartphone app.”

The software has features that are common in more advanced versions of Facebook, including sticker-size emoticons in chat and Instagram-style filters to dress up photos. (Facebook for Every Phone can be used by feature phone customers anywhere, including those in the United States. It can be downloaded from Facebook using the phone’s mobile browser or obtained from app stores operated by the phone maker or independent companies like Getjar.)

Brian Blau, who studies consumer technologies at the research firm Gartner, said that given Facebook’s mission of linking the entire globe through its service, it needed to reach out to the least tech-savvy customers.

“They talk about socially connecting the world together,” he said. “They can’t do that until they connect people who don’t have smartphones or computers.”

To understand how far Facebook has come in its approach to mobile devices, consider this: until two years ago, the only way to sign up for the service was through a Web browser, which is much slower to use than an app. Facebook originally viewed phones as mostly useful for posting status updates, not as a primary way to access the service, said Javier Olivan, who heads Facebook’s growth team.

Eventually, the company realized that tens of millions of people in developing countries were eager to try Facebook but had no access to a computer, nor could they afford the $600 iPhones or $40-a-month data plans common in the developed world.

“It became very obvious that the next wave of users would come on mobile only,” Mr. Olivan said in an interview last week.

Article source: http://www.nytimes.com/2013/07/22/technology/for-developing-world-a-lightweight-facebook.html?partner=rss&emc=rss

China Trade Figures Rise, but Weaknesses Persist

HONG KONG — Trade figures for April released by the Chinese government on Wednesday morning were slightly better than economists expected, but still indicated that demand was fairly weak in foreign markets and in China itself.

Exports and imports both increased last month compared with a year earlier, but the figures were harder than usual to interpret because April of last year was so weak. Imports and exports all but stopped growing in April of last year as a wide range of industries, perceiving a short, sharp domestic economic slowdown that would last until early autumn, stopped buying industrial commodities, even as foreign buyers cut orders as well.

Compared with that weak base, China’s trade figures for last month looked somewhat better. Exports rose 14.7 percent from a year ago, while imports increased 16.8 percent.

But the trade figures were far from strong enough to suggest that foreign demand could pull China out of what seems to be a deepening economic malaise. Although official figures still show the economy steaming along at a growth rate of nearly 8 percent, a range of purchasing manager surveys last month showed growing worry among business executives across China.

“China is in a very difficult position now,” as American and European consumers seem wary of further increases in the coming months in their purchases of Chinese goods, said Diana Choyleva, an economist in the Hong Kong office of Lombard Street Research, an economic analysis firm.

The discouraging shift in sentiment, after a fairly weak economic performance in March as well, comes despite enormous lending through the autumn, winter and early spring. China’s leaders were able to turn the sharp economic slowdown a year around by flooding the economy with bank and trust loans, and other credit.

But the heavy lending has brought about considerably less economic growth than earlier rounds of monetary easing, raising worries that China’s investment-dominated economy is running out of economically viable projects to pursue and may not be able to shift quickly enough to consumer-led growth.

China has scheduled the release of April inflation data on Thursday, and a wide range of April economic statistics next Monday, including including industrial production, fixed asset investment and retail sales.

Another uncertainty about Wednesday’s trade data lies in whether the export figures are even accurate, or whether they have been artificially inflated. A gradual rise in the value of the renminbi against the dollar over the last year, together with expectations that this rise will continue, has created an incentive for exporters to overstate the value of the goods they ship out of the country, as a way to bypass China’s currency controls and bring more dollars into the country to convert into renminbi.

The Chinese government has opened an investigation into whether exporters are overinvoicing clients, after export data in the first quarter showed unusual patterns, including a surge in reported Chinese exports to Hong Kong that did not match Hong Kong data.

Louis Kuijs, an economist in the Hong Kong office of the Royal Bank of Scotland, estimated that overinvoicing of exports accounted for more than half of the year-on-year growth in China’s exports last month. By adjusting for this, he said that the true growth in China’s exports last month appeared to be more like 5.7 percent than 14.7 percent.

 There has been little sign of manipulation of import figures, which appear to show that domestic demand is holding up a little better than overseas demand.

 

Article source: http://www.nytimes.com/2013/05/08/business/global/china-trade-figures-rise-slightly-but-weaknesses-persist.html?partner=rss&emc=rss

Japan Aims to Join Trans-Pacific Partnership Talks

In an impassioned televised address, Mr. Abe portrayed the pact, called the Trans-Pacific Partnership, as Japan’s last chance to remain an economic power in Asia and shape the region’s economic future.

“Japan must remain at the center of the Asian-Pacific century,” Mr. Abe said. “If Japan alone continues to look inward, we will have no hope for growth. This is our last chance. If we don’t seize it, Japan will be left out.”

With strong opposition from Japan’s farming lobby and other powerful groups, Mr. Abe is taking a big political risk in embracing the free-trade talks. Japan’s largest agricultural cooperative has campaigned against trade liberalization. It says such a change would devastate the nation’s farms, a plea that has resonated in the wider public. A majority of the lawmakers in his own Liberal Democratic Party depend on the rural vote and object to the free-trade deal.

Mr. Abe is betting, however, that his strong popularity will help him ride out the furor. He will face his first test at the polls this summer, when national elections for Parliament’s upper house are scheduled.

“I promise to take the best path forward for Japan’s national interest,” he said. “I will protect what we must protect and demand what we must demand.”

To soften the blow of a more open economy, Mr. Abe has secured vague support from the United States that some Japanese agricultural products — like rice, which is protected by a 778 percent tariff — would be exempt from the free-trade negotiations.

But insisting on these exceptions could hurt Japan’s hand in negotiations elsewhere, especially in talks to gain further access to foreign markets for its manufacturers, which account for three-quarters of the country’s exports. And some participating countries worry that Japanese demands will slow the talks.

The lead negotiator for Singapore, Ng Bee Kim, said last week that Japan would be permitted to participate only if existing members agreed that it could “keep up the good momentum” at the talks.

It is unclear to what extent Mr. Abe is willing to commit to other structural changes that the pact might demand of Japan’s economy.

Japan’s levies, which average 6.5 percent for its trading partners on most goods, are in line with those set by other industrialized nations. The exception is agricultural produce, on which Japan applies an average tariff of 25 percent.

The partnership seeks not only to eliminate tariffs but also to do away with other barriers to foreign trade, like cumbersome regulations — for which Japan is notorious — in retail, health, automobiles and other fields that shut out foreign competitors.

Proponents of free trade say such overhauls could transform the Japanese economy for the better, making insular industries more competitive. Joining the Trans-Pacific Partnership would expand the Japanese economy by at least $33 billion — nearly 0.7 percent — the government estimated.

Mr. Abe has made such structural changes one of the three pillars of his economic growth strategy, together with an aggressive monetary policy and government spending.

“It’s a start, but a very welcome step for economic growth,” Ryutaro Kono, Japan economist for BNP Paribas, said in a note to clients.

But Japan’s agricultural cooperatives have joined with other interest groups to portray the partnership as a threat to the Japanese lifestyle. A nationwide association of doctors opposes the pact, arguing that it will force Japan to open its state-controlled health industry to American-style health insurance, eroding its universal insurance system.

Article source: http://www.nytimes.com/2013/03/16/world/asia/japan-aims-to-join-trans-pacific-partnership-talks.html?partner=rss&emc=rss

Economix Blog: The Quiet Driver of Economic Growth: Exports

The estimates of the nation’s economic performance last year, released Friday, highlight a striking trend: Exports have never been more important.

Foreign buyers purchased more than $2 trillion in goods and services, the first time exports have topped that threshold. And those exports accounted for almost 14 percent of gross domestic product, the largest share since at least 1929.

Source: Bureau of Economic Analysis

We usually talk about exports alongside its opposite number, imports, and since the United States buys much more than it sells – our “trade deficit” — the general impression is that foreign trade is a drag on the economy. But that tends to obscure the importance of exports, which have accounted for about 10 percent of G.D.P. over the last two decades and, since the recession, considerably more.

The growth has come from all areas, but the real strength has come from what might be called the old economy: petroleum, metals, chemicals and farm goods.

(On the short list of goods the United States is selling in smaller quantities than in 2000: tobacco, shoes and apparel, and automobile engines.)

Much of the rise in exports is a consequence of domestic problems. The value of the dollar has declined, so that foreigners save money when they buy American. Businesses, struggling to find customers here, are focusing on foreign sales. And a boom in commodity prices, which has raised the price of life for most Americans, has produced a windfall for those who trade in commodities.

This is a good thing on the whole. The ability of American companies to make money in foreign markets is helping to offset the pain of those domestic problems.

Indeed, the Obama administration has hailed the growth as a key to economic recovery, and in 2010 declared a goal of doubling exports to $3.1 trillion by 2015.

That goal may prove hard to reach, as Annie Lowrey explained in a recent article. But the trend itself is real enough, and likely to continue.

Article source: http://feeds.nytimes.com/click.phdo?i=a9bec3baa6521e3726344641e4618121

Chinese Let Currency Rise Against the Dollar

HONG KONG — China’s currency staged a small but unexpected rally this week, as the country’s central bank allowed it to rise 0.72 percent against the dollar, with most of the move coming Wednesday and Thursday.

The State Administration of Foreign Exchange, which is part of the central bank, fixed the initial trading value Thursday morning below 6.4 renminbi to the dollar for the first time in the modern history of the currency.

Economists and traders interpreted the new trading value, 6.3991 to the dollar, as a signal that the central bank might be willing to tolerate a slightly faster rate of appreciation against the dollar, something the United States and other big industrial nations have long pressed China to do.

Daniel Hui, a senior foreign exchange strategist at HSBC, said in a research note that the recent movement in the daily fixing of the renminbi “indicates something has changed — the question is why, and if it will last.”

Allowing the renminbi to strengthen can help China fight inflation, by making imports cheaper. But a stronger renminbi can also hurt exports and employment at China’s many export-oriented factories by making Chinese goods more expensive in foreign markets.

The government’s National Bureau of Statistics announced Tuesday that inflation in consumer prices had reached 6.5 percent in July, the highest level in three years. At the same time, China’s exports were showing unusual strength despite economic weakness in the West.

China’s General Administration of Customs announced Wednesday that exports were up 20.4 percent in July from a year earlier, more than most economists had expected, producing a trade surplus of $31.5 billion, the country’s largest in more than two years.

But any sustained acceleration in the appreciation of the renminbi could bring greater speculative inflows of money to China. As a result, many economists have been predicting that China may soon allow the currency to trade in a wider band each day around the initial fixing, which is done in Shanghai. Greater volatility makes it harder for speculators to borrow money to put bets on a rising renminbi.

The Administration of Foreign Exchange sets an initial trading value each day and then keeps the currency within a tight range around that value through the day by buying dollars, frequently on a large scale, and selling renminbi. In theory, the currency can vary during the day by as much as 0.5 percent, but the government has tended to keep the daily trading in a much tighter range, often less than 0.1 percent.

China’s foreign exchange reserves swelled by $350 billion in the first half of this year — equal to one-ninth of the country’s economic output in the period — mostly because of this currency market intervention. The Administration of Foreign Exchange also earns interest on its reserves, which totaled $3.2 trillion at the end of June.

Article source: http://feeds.nytimes.com/click.phdo?i=ca626d2d8bdea6feb3df3c20f21dbd18