Displaying items by tag: Economy

After a wild few months in the UK economy, the Government wants to raise more money to cover a big black hole in its accounts. Jeremy Hunt, the Chancellor, has said everyone must pay more tax. Meanwhile, a group of economists have questioned whether the ‘black hole’ in public finances must be filled with austerity and tax rises. They said that the £50bn hole entirely disappears if debts are calculated differently. When Rishi Sunak was chancellor two years ago, he used a different accountancy rule to arrive at a government debt figure. Changing it back to what it was before the 2021 Autumn Statement completely removes the black hole, according to the economists' analysis, and will put government debt back on a sustainable footing. Pray for Jeremy Hunt and all members of the treasury to be wise regardless of the accountancy rules they choose to follow.

The Chancellor announced targeted payments to help with the cost of living. The national wage will jump from £9.50 to £10.42 an hour from April; help for energy bills will be extended, but less generous. There will be cost of living support for pensioners, the disabled, and those on low incomes. Means-tested benefits, including Universal Credit, and pensions will rise in line with inflation. Social sector rent rises will be capped at 7% in the next financial year. However, the cap on social care costs due next October will be delayed by two years. A ‘temporary’ 45% tax on companies generating electricity will be applied from January, and windfall taxes on oil and gas company’s profits will increase from 25% to 35% and extend until 2028. The NHS budget will increase in each of the next two years by an extra £3.3bn, and schools will receive £2.3bn extra in 2023 and 2024.

On 17 October Jeremy Hunt reversed 60% of the promised recent tax cuts and committed to reduce the two-year energy price guarantee to six months, while introducing ‘a new approach’ to the most needy after winter. A cut in basic income tax rate, promised by two chancellors this year, was cancelled. Pray for adequate advice and aid for those facing staggering rises in the cost of living. The changes caused political turmoil. On 18 October, senior aide Jason Stein was suspended for leaking information to the media. Next, home secretary Suella Braverman resigned because she had broken the ministerial code, and attacked Ms Truss's leadership in her resignation letter. Grant Shapps, who six weeks ago was sacked as transport secretary, replaced her. On the 19th an attempted fracking ban sparked havoc when rebellious Tories were threatened with party expulsion if they didn’t back Liz Truss. See the previous article, PM resigns.

We pray for peace to cover this nation. We speak hope instead of despair, prosperity instead of lack in finance and the economy; stability to markets, and wisdom to all those making decisions and directives. We agree with James 2:13 (‘Mercy triumphs over judgement’), and repent where our nation as well as our own actions have brought Your judgement upon us. We repent where debt is an accepted norm of society; we repent where we withheld when You asked us to give; we repent where there has been mismanagement, greed and corruption within the very structures of our society, and we ask forgiveness for every place where we as a nation have not stewarded well the resources You gave us. We ask for Your revelatory wisdom to those working at the Treasury and Bank of England. We ask that You connect what needs to be connected and disconnect what needs to be disconnected, so that this nation will be blessed in the year ahead.

Oman’s economy is heavily dependent on declining oil reserves. It has begun focusing on tourism as a new source of economic growth. Diverse untouched landscapes of coastlines, deserts, and mountains are unique destinations for travellers. The Oman Arab Bank recently sponsored their third tourism forum to train young adults in the tourism industry. While this boosts Oman’s economy, it is also an opportunity for the Gospel to reach five million people who have never heard the good news of Jesus’ love and gift of salvation. Proselytising is illegal, and those in active Christian ministry experience pressure to leave the country. But as tourism increases, creative access to new people groups will become more feasible. Pray for successful expansion of current Oman ministries: relief and water projects, media, literature, business as ministry, urban evangelism, and church planting. As tourism meets the financial needs of Oman, may the Church go forth to meet the spiritual needs.

A refugee agency in Lebanon noted discrimination and violence against Syrian refugees rose sharply recently, with more confrontations at bakeries where refugees often have to wait for bread behind Lebanese citizens. Rawan Haddad, of Tent Schools International, said that the refugees’ situation is sometimes better than most Lebanese. Nations provide basic support and limited facilities for refugees, but Lebanese below the poverty line have no support. There are shortages of bread, flour, and medicine. People don’t make enough to buy what they need, and the government won’t help. With these concerns in mind, Lebanese officials have now announced they plan to repatriate refugees back to Syria, but the problem is that European countries will not agree to that course of action.

Drought is threatening the Iraqi tradition of growing amber rice, a key element in a struggling economy. This variety of rice, which takes its name from its distinctive scent, is widely used, but after three years of drought amber rice production will be only symbolic in 2022, forcing consumers to seek out imported varieties and leaving farmers pondering their future. Rice fields normally stay submerged all summer, but that’s a luxury Iraq can no longer afford. The country’s available water reserves are well below the critical level. Officials have limited total rice crop areas to 1,000 hectares; the normal quota is 35,000. The water shortages have also led to reduced quotas for wheat farmers. Last year, the agricultural sector contracted by 17.5%, according to the World Bank.

The UK could be heading for a recession. The economy contracted by 0.1% in March, and higher prices are ‘really beginning to bite’, the Office for National Statistics said. People are spending less in shops and cutting down on car journeys; the impact of higher energy bills in April has also yet to be seen. Many price rises are just starting to hit households now. Last week the Bank of England forecast that inflation could reach more than 10% by the end of the year. It warned the UK faces a ‘sharp economic slowdown’. The chancellor has threatened to hit energy companies with a one-off ‘windfall’ tax if they don't invest enough in new projects. Opposition parties want to tax the soaring profits of oil and gas firms to help families grappling with rising bills. Treasury officials have been ordered to examine a potential tax, and Boris Johnson said the Government would have to look at the windfall proposal if not enough investment was made.

African countries have some of the world’s deepest gas reserves. President Hassan said Russia’s invasion of Ukraine is an opportunity for gas sales: Tanzania aims to secure a new energy market outside Africa and has been working with Shell to utilise their vast offshore gas resources and export elsewhere. He said, ‘Whether in Africa, Europe or America, we are looking for markets.’ Nigeria, Africa’s largest gas producer, has similar plans. They intend to build a trans-Sahara pipeline, taking their gas to Algeria and Europe. They recently signed an agreement with Algeria and the Niger Republic to construct the 381-mile-long Trans-Saharan Natural Gas Pipeline, beginning in northern Nigeria. However there are concerns over the historic lack of investment in gas infrastructure that has hampered the energy industry. Many African countries with massive gas reserves have struggled to attract investment to build gas infrastructure projects that would have supplied the European market. Ask God to use the current Russian gas situation to take many African nations out of poverty.

11% of Lebanon’s population is over the retirement age (65), and 80% of retired people have no health care coverage. Previously Habeeb and Elham had a good life; they could eat meat, afford medicine and have the lights on. But those times are over. When Habeeb retired their income stopped and now the 80-year-olds face poverty and uncertainty. ‘There is no government pension when you are old, no one is helping. How can we pay our bills?’ asks Habeeb with tears in his eyes. Lebanon has one of the world's worst economic crises. The Lebanese pound has lost 90% of its value since 2019. The banking system crumbled with much of the elderly’s life savings. The young are abandoning Lebanon in search of a more dignified life. Lebanese lack electricity and water, and food and medicine are difficult to import. The aid group Medonations imports medication and provides it to those who need it, and there are a few relief outlets for the vulnerable.