The world this week - Business
The European Union unveiled ambitious goals to reduce greenhouse-gas emissions by 55% by 2030 (compared with 1990 levels) and to reach net zero by 2050. The plan sets out a range of policies to help meet the targets, but the main thrust is an expansion of the EU's Emissions Trading Scheme, in which companies pay to pollute. It would also introduce a Carbon Border-Adjustment Mechanism, in effect a tariff on goods from outside the EU that are not green-friendly. The announcement came days before China was expected to announce an emissions-trading scheme that will create the world's largest carbon market.
China's economy expanded by 1.3% in the second quarter, compared with the previous three months, helped by growth in manufacturing, retail sales and investment. China's exports, meanwhile, rose by 32% in June (in dollar terms) over June 2020. Although the rebound in trade reflects an easy comparison with the depths of the pandemic, it is much stronger than analysts had forecast.
America's annual rate of inflation hit 5.4% in June, another 13-year high. Consumer prices have been driven up by higher energy costs, including for petrol, and also by demand for used cars. Prices for second-hand vehicles have accelerated as the production of new cars stalls amid a global shortage of chips.
The Bank of England scrapped the restrictions on banks' dividend payouts and share buybacks that it imposed during the pandemic. The Federal Reserve has already removed similar curbs on most banks in America; the European Central Bank is expected to follow suit.
Meanwhile, the ECB gave the go-ahead for a pilot project for a digital version of the euro as an alternative to crypto currencies, such as bitcoin. In London police seized ￡180m-worth ($249m) of cryptocurrency linked to money-laundering and other nefarious activities. It was one of the biggest such seizures globally and came a few weeks after the city's police confiscated ￡114m in cryptocurrency from other illicit gains.