Competition from lower-cost airlines such as EasyJet and Ryanair has redirected the demand from pricier Air France to its cheaper counterparts. As a result, the beginning of this year saw Air France faced with a net loss of €614 million. In a move to become more cost-effective, Air France had planned to shift its focus on to the cheaper Transavia Airlines. Unfortunately for the pilots (who mind you, appear to earn €160,000 yearly,) this low budget airline would mean lower pay and welfare benefits- effectively leading to the longest strike Air France has seen since 1998. Evidently, a move to become more cost-effective has backfired and the airline is losing €20 million a day due to the strikes.
Recent decisions by Beijing to “vet” political candidates for the 2017 chief executive elections have sparked protests throughout Hong Kong. These pro-democracy protests have dominated political and economic headlines over the past week. Beijing’s decision is alarming as Hong Kong is accustomed to freedom. The reasons for this oddity are explained in this video:
So as many speculate, China has been slowly planning or the 2040’s confrontation (explained above) and one way to ease the looming transition is to slowly gain influence over affairs in Hong Kong. One plan is to eventually make Shanghai the economic capital of China, slowly overcoming Hong Kong. But at what cost? Is the outcome worth it?
The main question for people concerned is, will Hong Kong’s protests dent its economy? There certainly has been evidence of that as it is estimated that Hong Kong protests may cost retailers HK$2bn. Moreover, there has been a growing lack of confidence with foreign investors and current stockholders. This has decreased the strength of the HK$ which is a further economic burden.
All of this is due to the Chinese government trying to secure its grip over its liberal island. Whatever the outcome, it would be a shame to see one of the most successful free market economies fall due to increased censorship and less economic freedoms.