In late August, Turkey increased a special consumption tax known as Özel Tüketim Vergisi (ÖTV). The tax primarily relates to imported luxury goods, which includes imported cars. The tax was first introduced in 2002. However, it increased in recent years due in part to Turkey’s economic downturn.
With the rapid spread of COVID-19 throughout the past few months, many locations throughout the world are experiencing shortages and/or price changes to many goods and services items. The unprecedented outbreak has led to shortages in many locations that do not regularly experience supply disruptions. Reasons for the shortages include exceptional demand for certain items such as disinfectants, medical products, and non-perishable staple foods, and disruptions to supply chains resulting from travel or operational restrictions.
For years, Venezuela’s currency (currently the VES, was VEF) was the only currency legal to use within the country. However, with hyperinflation and a rapidly depreciating currency, using the VES was often difficult. Although not technically legal, transactions would often still occur using U.S. dollars, as it is a stable currency.
On August 11th, Argentina held primary elections ahead of the general election scheduled for October 27th. Center-left candidate Alberto Fernandez and running mate former President Cristina Fernandez de Kirchner defeated center-right President Mauricio Macri. This result created uncertainty about the future of Argentina’s economic policy. Many investors pulled their money out of Argentina, and ratings agencies such as Fitch and Standard & Poor’s downgraded their credit rating. The peso experienced rapid and significant devaluation against the dollar, losing roughly 20% of its value in a matter of days. In an effort to stabilize the peso, Macri re-instituted currency controls that had been eliminated in 2015.
There has been a widespread outbreak of African Swine Fever (ASF) in Asia. ASF is a virus that causes hemorrhagic fever in pigs, with a mortality rate approaching 100%. The disease kills pigs rapidly, typically in two to ten days, but is harmless to humans.
Singapore can be one of the most expensive places in the world to purchase a vehicle because of the Certificate of Entitlement (COE), which is required for purchasing a car and allows for ownership for a period of ten years. Singapore uses a Vehicle Quota System (VQS) to determine the number of COEs made available to the public.
Global gasoline prices fell this quarter compared with our data from six months ago. Oil prices hit a recent high in early October but have fallen sharply since. US crude, for example, had its weakest month in a decade as the price plummeted 22% in November.
Critics say this is merely a superficial solution and will do nothing to combat hyperinflation. This announcement followed presidential candidate Henri Falcon’s proposal to dollarize the Venezuelan economy.
President Maduro recently announced the creation of the Petro, Venezuela’s own cryptocurrency, backed by natural resources such as oil and gold.
On May 31, Venezuela announced the results of the first currency auction for its new DICOM exchange rate, the fifth such currency control mechanism introduced since 2003.