As the nation continues it’s extensive reconstruction program, yet another challenge faces the nation: the economy. Whilst during the civil war, the Turtle Bay Stock Exchange was shut down for nearly 5 years, numerous companies have been forced to file for bankruptcy, as their headquarters and places of business where destroyed during the war. Many family owned businesses have also failed, due to losing most of their employees, as men and women where drafted in mass into the military on both sides. However, noting the worsening economic conditions, Queen Éva has formed the Economic Development Bureua to recuperate the Keymonite economy.
Queen Éva announced the formation of the Economic Development Bureau earlier today, in a press conference held at the Ministry of Finance. She stated that:
The economic problems facing the nation must be solved very soon, because for this nation to move forward, we must rebuild our nations economy. To rebuild our nations economy, we must focus on the industries that shall bring economic prosperity. Not economic desperation. To achieve these goals, I, Queen Éva, will use my full executive powers as the absolute monarch of Keymon, to form the Economic Development Bureau, which will be given the governmental authority to enact changes to the laws, or enact new laws, at the Head of the Bureau’s discretion.
The Council of the EDB will have 20 members, 10 representatives from Keymon’s largest economic sectors and 10 appointed by Edmond Demaret, our Minister of Finance. This will allow both the government and corporations to negotiate with each other and come to compromises that will ultimately, directly benefit the people of Keymon.
According to financial analysts throughout Terra, this move will possibly move financial capital from the more successful industries of Keymon, such as the services and trade industry, to new and upcoming industries, such as high tech manufacturing and the technology sector. However, this body may potentially fall into stalemate, as the government and the representatives of major industries butt heads over taxation and other issues of financing.
In a TV interview, Minister of Finance Edmond Demaret claimed that the Economic Development Bureau would ultimately benefit Keymon regardless of the results of the Council of the Bureau. Mr. Demaret stated that:
This body will provide and benefit Keymon. It allows the industries and government of Keymon to directly negotiate and benefit from each other’s powers. It will benefit Keymon, one way or another.
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As the countries economy slowly emerges from the civil war, and as more soldiers are sent back home to destroyed businesses and lost jobs, many have questioned what the EDB would do to bring back the jobs lost in the civil war. Now, the first apparent answer is here, however it is already highly controversial. The EDB has announced that they have cut regulations in the manufacturing, agricultural, construction, and technology sectors.
The Head of the EDB, Léone Bourbeau made the announcement, following nearly three weeks of constant negotiations with representatives from the countries largest economic sectors, many of whom complained about the “vagueness” of the regulations surrounding labor laws. Mrs. Bourbeau stated that-
The laws concerning labor are over 150 pages long…that is simply ridiculous and cannot be acceptable if we want this country to once again thrive. We at the EDB have gone through the hundreds of pages on labor laws and have cut the laws down to 50 pages. Whilst that’s certainly still a lot of pages, it’ll be a bite sized version of the previous laws.
Once the EDB finished cutting regulations concerning the labor laws, we began looking at numerous other regulatory laws and noticed that they where either redundant, or where irrelevant for the modern world. So, we decided to begin scrapping said laws and attempting to simplify the regulatory laws of the nation, which will be the ultimate key to economic revival in the country.
The regulatory laws repealed by the EDB have, however, angered many, especially those within trade unions. Many union leaders claim that, by not being invited to the EDB to discuss reducing regulations, that the average worker was going to be misused and mistreated. They also critiqued the regulatory laws being repealed, including laws concerning the amount of carbon monoxide that may be present in factories and the number of employees that may be placed into a single room.
One Union Rep told us at the Island Times that:
What is happening is we’re sacrificing working conditions for economic prosperity. Whilst that may work in the short term, it will crash in the long term. And when that happens, this nation will collapse back into civil strife once again.
According to some unconfirmed rumors, Union Reps are considering taking the EDB to civil court.
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As the nation continues to push through economic and infrastructural repairs and reforms, yet another threat has arisen to face the nation. The issue of debt and when and how the country should pay it off. The EDB believes it has the solution: ending sovereign debt repayments for 5 years. Yet many claim that this move will merely harm the nation in the long term.
Prior to the civil war, the federal government’s debt to GDP was around 20%, relatively low for a developed nation. However, as the civil war began, all sides of the struggle began to take out loans to fund their militaries, to fight the others. And whilst the Royalist government under Queen Éva did ultimately win the war, the debt from all three major combatants (New Valois, the Royalists, and the Carluists) has fallen upon the newly formed government. This has caused the government to lose badly needed cash, just so it can pay off debtors. The nations debt to GDP is now at 50%, which is quickly draining the quaffers of the government. To prevent further loss of revenue and to prevent any slowdown in the reconstruction efforts, the EDB has announced that it will halt all sovereign debt repayments for 5 full years. Head of the EDB Léone Bourbeau stated that-
We’re spending billions of dollars on debt, that should be going towards rebuilding our war torn nation. It’s entirely shocking that the government hasn’t declared baker up the, because we are being forced to spend 30% of our budget on debt repayments, which is significant for a nation attempting to rebuild itself. So, to prevent further wastes of cash, we’ve decided to halt all sovereign debt repayments for 5 full years, in an attempt to rebuild the nation quicker. Let it be known to all the debtors our there, this is not a default. We are merely halting the payments. Once those 5 years are up, we shall continue paying, and will pay for the skipped 5 years as well.
Whilst most financial analysts agree that this move will certainly free up capital, which can then go to rebuilding Keymon’s infrastructure and building new economic projects, many also question if it is even legal for a country to simply refuse to pay off its sovereign debt. Whilst most agree that, it is the states full right to do so, many owners of Keymon Sovereign Debt have threatened to take the government to the Supreme Court of Keymon, to reassert the debtors claims that the government cannot merely postpone paying off its debt.
Perhaps this move will ultimately be a net positive for the creditors holding Keymon Sovereign Debt, as they see this nation rebuild and reform itself. However, time will only tell if these creditors ultimately either benefit or are harmed by this.