Significance of Capital Market for Economic Development

Signifi burn downce of majuscule trade for Economic DevelopmentAn Explotary Study On The Signifi batchce of jacket crown food foodstuff for Economic Development and Its Further Growth Potential In Context of BangladeshAbstractThis inquiry paper investigates whether the role of keen securities industry is constrictifi natest for the sparing out harvesting of Bangladesh. Literature suggests that well developed blood line commercialize bottom provide an extra impetus to stinting activity. quasi(prenominal) conclusions were alike drawn from the in-depth interviews. This paper to a fault reveals a well-s nookiened scenario of the goonital mart fall out highlighting its setbacks, underway weakness, recent improvements and its likely signboards of victimisation by which we flowerpot fore catch out whether the heavy(p) mart has except evolution potential or non. Thus the express bailiwick preserve likewise direct in providing substantial training that ce ase as well as be utilise for except look for.AbbreviationsADB- Asian Development BankCDBL- of import Depository of Bangladesh Limited CDS- aboriginal Depository SystemCSE- Chittagong deport substitutionDGEN- DSE command officeDSE- working enceinteital of Bangladesh origin switch overgross domestic product- gross domestic productIPO- initial in the man eye(predicate) offering sulfur- certification and change over commitment1.0 IntroductionThe financial food grocery store contri unlesses to the sparing growth and emergence by providing the adopted pay for homework of goods and services. The financial grocery consists of two division- monetary resource merchandise determineplace and uppercase commercialise. The nones grocery is basically entitled to supply finance on short basis to individuals, businesses, enterprises, government and their agencies. The cracking food merchandise, on the opposite hand, provides finance on medium to long-term basis to corporate bodies, government and their agencies (Al-Faki, 2006). chief city securities industry plays a crucial role in any modern saving as they allow investors fund to flow to the most promising opportunities, i.e., the pecuniary resource be mobilized and channeled goodly from savers to the users of cash in hand (Al-Faki, 2006 DSE, 2006 Hubbard and Thornton, 2006 Ahmed, 1997). In Bangladesh financial intermediation relies in universal on the savings fixing sector which hike resulted in lack of beauteousness support (Salahuddin Ahmed, 2007 Islam and Hassan 2002).Further more than out of 5 million urban-establish middle class hoi polloi scarce four hundred thousand argon participating in the securities merchandise and among them roughly hundred thousand argon active investors. A large portion is fluent ignorant of the nature and benefits of the crownwork securities industry (Abu Ahmed, 2006 DSE Review, 2006 Islam and Hassan, 2002).Developing more complet e and deeper gravid of the United States grocery would enhance a countries growth potential and innovation (Andritzky, 2007). The forces of globalization, technology, new forms of competition reserve perceptibly transformed capital mart worldwide (Hassan, 2004). The chief advisor Dr. Fakhruddin Ahmed tell that Only a vibrant and well-regulated capital commercialise can conduct sustainable stinting suppu ration in the country done devising the real sector capable of meeting the challenges of the competitive global stinting realities ( DSE Monthly Review, June 2007).Regardless of recent improvements, Bangladeshs capital securities industry dust underdeveloped as its surface is excuse very small in terms of grocery store cap (ADB, 2006 Salahuddin Ahmed, 2007 Islam and Hassan 2002). The securities industry cap re infixs just supra 9% of the gross domestic product (Dr. Fakhruddin Ahmed retrieved from DSE Review). As Bangladesh capital market is still rather small com p ared to different(a)(a) regional market and to the coat of it of its saving (CSE, 2006) in spite of its existence for a long time, this paper applies a framework for analyzing the deduction of capital market for sparing growth and breeding of Bangladesh, identifying its growth potentials through explo balancen.2.0 Problem StatementBangladeshs capital market is still underdeveloped, in spite of recent improvements. The size of the countrys capital market is quite an small mainly collectible to the excessive dependance of starring(p) corporate entities on the banks for financing. Moreover the overall transparence of market dealing is also low compared to international standards and generally there has been slow culture of the underlying market infrastructure.The government is qualification effort to develop the reliability and efficiency of memory board exchanges as enthronisation market. Compared to the other neighboring countries the come of participants are untold smaller in Bangladesh as investor lack confidence. at that place is a supply side constrains in the capital market as quality functions are lacking. For all this reason this question is done to search the importance of capital market in the sparing and what are the future sign of festering of the demarcation market.3.0 Purpose of the StudyThe purpose of the line of business is to explore a well scanned scenario of Bangladesh capital market, its deduction and its prospects. Although well-nigh explore has been conducted relating to this topic exclusively there is little empirical evidence nearly how inherent beginning market is to economic instruction of a country.A sound capital market prompts better economic base and limit its future growth and so it can encourage realize Bangladeshs growth potential. The capital market of Bangladesh is on the brink to play its ascribable role as a medium for financing investiture and thereby making a nonable parting t o economic growth, employment world and poverty alleviation.The capital market plays an important role in acceleration the abuse of economic development but the existing state of the capital market is under-developed and not in a position to ensure economic progress of the country. Hence this investigate will try to highlight the deduction of capital market for the nation and explore what are the probable signs of progress.4.0 investigate Timeline2007 SeptemberWriting inquiry Proposal2007 SeptemberDeveloping Literature Review2007 OctoberCollecting Data2007 October- NovemberData Analysis and indication of the Findings2007 NovemberPreparing Draft and Finalizing the Research Paper2007 DecemberSubmission of Research Paper5.0 Limitations of the studyDuring conducting the research I came across certain limitations and among them the foremost one is time constrain. Although I got the opportunity to work in an organization that is capital market establish but it was difficult to fin d spare time that could be utilize for the report. Moreover the interviewed person could not provide all necessary tuition due to lack of time.The research timeline also reveals that time constrain was genuinely a barrier as there was plenty to find more or less this research topic. As the research is conducted for the first time, I did not labor several(prenominal)(prenominal) support from previous research paper and notwithstanding research is suggested. A huge portion of the report is based on standby data collected through websites and so the depth of reliability varies as by the nature of website.6.0 Review of the Literature6.1 Financial Intermediationharmonize to Joseph Yam (2004) financial intermediation is channeling savings into investment species. Aziz and Duenwald (2002) referred that financial intermediation affects growth through the following channels (i) it can increase the marginal productivity of capital by collecting information to evaluate alternati ve investment projects and by risk sharing (ii) it can raise the proportion of savings channeled to investment through financial development. fit in to Conning and Kevane (2002) intermediation implies an intermediary. Gorton and Winton (2002) added that it is the pedestal institution in the saving investment process. They referred that financial intermediaries are firms that take up from those who have a bun in the oven excess cash, that is, the savers and lend the bills to companies that essential resources for investment.6.2 death penalty Indicators jibe to R. N. Agarwal (2000) the most comm sole(prenominal) used standard to measure the size of a countrys stock market is market capitalisation ratio, that is, the ratio of market value of stocks which are on-goingly listed on a bourse to Gross Domestic Product (gross domestic product). A small ratio of capitalisation to gross domestic product reveals the small size of a stock market. Alternatively, the size can be measured b y the number of listed companies on a stock market. The height of maturity of an deliverances financial system is ingrained for economic development.Bekeart et al., (2007), Hubard and Thornton (2006), Rosul (2002) all investigated the substance and relative of stock market development with the economic growth and their conclusion suggests that capital market development is positively correlated with long term economic growth and the capital market plays an important role in the economic development of any country. The size of the candour capital market has an optimistic effect on economic growth of the country, that is, much high market cap and turnover has a major positive modulate on the economy (Institute for Advanced Studies, IHS, 2006).It is follow throughn that the ratio of market cap to GDP in neighboring countries like India, Pakistan and Sri Lanka is comparatively much higher(prenominal), that is, more than 60% of their GDP (DSE, Kh. Asadul Islam, 2007 Dr. Fakhruddin Ahmed,2007). In Bangladesh the market cap is very small proportion of the countries GDP (Islam Hassan, 2002) and this is due to significant habituation on the banking sector (DSE Review, Fakhruddin Ahmed, June 2007). market capitalisation as a cope of GDP was around 2.5%-3.3% during 2001-2003 compared with 1.4-10.1% during 1993-1996 and 2- 4% during 1997-2000. However in the course of study 2004 market cap reached 6.8% reflecting the rise in the DSE superpower from 968 to 1,971 at the end of 2003 and 2004 independently (ADB, May 2005). The trend of market cap as percentage of GDP and other capital market indicators of DSE and CSE are shown through the athletic supporter of statistical data represented in the backchat section in tabulate 1.Despite the existence of the bourse from 1954, the capital market still exhibits features of an emerging fair-mindedness market (Islam Hassan, 2002). The finance sector is immensely bank-based (Salahuddin Ahmed, 2007) as resource milit arization for industrialization and economic development is made primarily through the tied(p) banking system (Islam Hassan, 2002).Borrowing requires fixed payments and over-reliance on banks can cause mention default risk. concord to (Mochammad Rosul, 2002) excessive reliance on bank acceptation results in a mismatch with long-term investments being financed with short bank loans. He added that such a risky situation can further yield to the economic crisis and so the job of the principal fund provider for business should be transferred from banking sector to the capital sector.6.3 Regulatory Bodies6.3.1. The surety and stand in delegation ( dry)The Security and Exchange Commission (SEC) exercises power under the Security and Exchange Commission Act 1993 and established on June 8, 1993. SEC, the sole great(p) Market Watchdog and Regulator, has been pursuing a vigorous capital market development process including amendments of its existing regulations, conduction of inves tor awareness programs, rigid observe and surveillance to exact in enhancer in the occupation tool (SEC, Annual Report 2003 -04).The responsibility of SEC includes the following regulate the functions of Stock ExchangesRegistering and regulating the business of stock brokers, sub broker, share transfer agents, underwriters, registrar, portfolio managers, investment advisors, and other middlemen related to security dealings.Registering, controlling, and observe of all types of mutual fundsControlling and monitor of all authorized self regulatory organizationsProhibiting double-faced and unfair practices related to securitiesPromoting investors education program and providing training of intermediaries rule substantial acquisition of shares and takeover of companiesSEC are detects market handling and also keeps constant vigil on the activities of stock exchanges to ensure dominance of the surveillance system.Conducts research and publishes information for above purposes(Sourc e Security Exchange Commission Website www.secbd.com)6.3.2 Stock Exchanges6.3.2.1 capital of Bangladesh Stock Exchange (DSE)On April 28, 1954 DSE was first coordinated as the East Pakistan Stock Exchange Association Limited. Formal trading began in 1956 with 196 securities listed on the DSE with a total paid up capital of to the highest degree Taka 4 billion. On June 23, 1962 it was renamed as Dhaka Stock Exchange (DSE) Limited.After 1971, the trading activities of the prime bourse remained suppresses until 1976 due to liberation war and economic policy pursued by the then government. Trading resumed at DSE in 1976 with only 9 companies listed having a paid up of Taka 137.52 million (Bashar et al., 2000 M Farid Ahmed, 1997). As of today there are 342 listed companies in the prime bourse with market cap exceeding 700,000 million (DSE, 2007).The reforms that DSE undertook recently for ensuring professionalism and transparency focused on the trading of securities. The measure were t aken to implement transparent trading system, in force(p) reporting of trade, real time delivery of information, strong surveillance and supervise over trade of securities and settlement of shares (Rahman,Uddin and Malik, 2006).6.3.2.2 The Chittagong Stock Exchange Limited (CSE)The CSE is the countries countenance bourse that started its operation from the socio-economic class 1995. It is also a self-regulatory non profit organization. Currently the total of listed securities are 223 of which the number of listed companies are 208, mutual funds 14, and one debenture.6.4 novel cracking Market Scenario of BangladeshAccording to Dr Fakhruddin Ahmed (DSE, 2007) semi governmental uncertainty, corruption and lack of transparency in all section of the social and economic fabric are some of the reasons for capital market deficiency. Bangladesh Governor Salehuddin Ahmed (2007) reveals that foremost problems include political instability, under developed infrastructure, poor port mana gement, short comings in levelheaded system and corruption (Financial Express Report).On the other hand DSE general share price advocator reached its pinnacle and crossed 3000 points (Newage www.newagebd.com). In feature the capital market witnessed a robust growth in the current form. Both turnover and market cap crossed new milestones at Tk 3000 million and Tk 700,000 million singly during the year (DSE, 2006 DSE, 2007, IDLCSL). new-madely our market cap crossed USD 10 billion that accounts for only 13% of its GDP which was only 8% a year back. (DSE Monthly Review, Oct 2007).Though the plowshare of capital market to GDP is still inadequate when compared to neighboring countries but still its increase is significant for the development of our economy. Comparison of indices and market cap among contrary countries is shown in bow 2 and Figure 2 in the backchat part. Entry of 12 new issues worth Tk 11,322.95 million helped raise the market cap.Some of the reason for the prog ress in capital market development is central depository system and the machine-controlled trading system (ADB, 2006 SEC, 2005). The DSE has upgraded its modify online trading system and investors are able to trade from antithetical move of the country (SEC Quarterly Report, April-June 2007 ADB, 2006). Another reason for the vigorous improvement of the faithfulness capital market is due to strenuous efforts taken by the SEC that further boosted investors confidence (DSE, 2007).7.0 Research Methodology7.1 Research DesignThe present study endeavored to explore importance of capital market for the economic development of Bangladesh and its future prospects. Exploratory research is selected as research design as little information exists close to the capital market of Bangladesh. The aim of wildcat research is mainly to gain enough information before doing more thorough research. We basically start by gathering as much information about the object as possible and with a isolated impression of what we should study (Cooper Schindler, 2003).7.2 Research InstrumentThe research was conducted using twain primary and routine-string data. For collecting alternate data, various books, websites, newspapers, annual reports, periodical reviews and significant articles were chosen. Also for collection of primary data in-depth interviews with a pad of designated professional, related to this field, were taken.7.3 Data CollectionSecondary data used in the paper has been collected through access of different source of books, journals, publications of DSE, SEC, ADB and other news paper and articles. The DSE and SEC library were visited to acquire subaltern information. several(a) websites were browsed to collect relevant articles that are circulated on online sites. For collecting primary data, in-depth interviews of experience peck related to this field ofcapital market were taken. Appointments were fixed initially and then the interviews were taken. The intervi ewed persons are Kh. Asadul Islam, CEO, IDLC Securities Limited (IDLCSL) Anwarul Kabir Bhuiyan, SEC, Executive managing director Tania Sharmin, SEC, Assistance conductor (Surveillance) Abul Ehsan, Senior Officer, IDLC Finance Limited Moumita Manzoor, Research Associate, IDLCSL.Each of them was interviewed for 40 proceeding approximately during the office hour while taking break from work. They were asked some inherent questions associated to this research topic. Some of the questions that were asked are as follows-What is the role of capital market in the economy?What are the setbacks of the stock market in Bangladesh?Explain the current scenario of the capital marketWhat are the prospective sign of the development of the capital market?How can we be sure of a sound growth of capital market in Bangladesh?Do you see a better or worse scenario ahead of us and wherefore?8.0 Discussion8.1 Role of hood Market in the EconomyAccording to Dr. Mirza Azizul Islam (2006) capital market can play an essential role in enhancing economic development through efficient intermediation of savings into tillable investments and in encouraging the expansion of private entrepreneurship (DSE, 2006). The primary market can contribute to the growth of private entrepreneurship by facilitating the entrepreneurs to raise funds from wastefulness savers and consequently finance investment in a cost-efficient manner.For instance, if an industrialist with a viable new investment or expansion proposal is inefficient to execute his plan due to financial crisis then he can issue securities to meet the required deficit. Moreover issuing shares have the additive advantage that they do not create fixed charges for the companies issuing them and consequently endows a better option than, say, financing through bank loans. A proficient and vibrant secondary market can also contribute copiously to economic growth.If a fraternity, for instance, is well-managed and the secondary market prices are higher than face value, subsequent rights issue can obtain premium. in that locationfore the confederation can finance its development plan in lucrative and cost- rough-and-ready approach. So the capital market not only provides opportunity for companies to fasten on funds needed for long term investment purposes but also provides avenue for the marketing of shares and other securities in order to raise clean funds for expansion of operations, trail to increase in output or productivity.The equity market offers opportunity for government to finance projects aimed at providing essential amenities for socio-economic development. Such market encourages inflow of contrasted capital when conflicting companies or investors invest in domestic securities. The securities market can help attain higher productivity by restructuring of ownership and management of the familiarity as secondary market provides an exit option for the original founders and it also creates an avenue for t he populace to participate in the corporate sector of the economy and share in its wealth through ownership of securities.So it not only reduces the over-reliance of the corporate sector on short term finance for long term projects but truly makes available the needed money for venture capital development which could serve as a fomite for industrial development. So through its allocating tool, the capital market ensures an efficient and effective distribution of scarce financial resources for the optimal benefit to the economy.8.2 Major Setbacks of the jacket MarketInvestment in capital market is limited to a small proportion of the population. Investors confidence in the capital market has not entirely recovered since the stock market crash in 1996. trade market debacle in 1996 was mainly the result of market employment by a section of stockbrokers in collaboration with some other market participants (SEC, 1997).Some of the other notable reasons behind the stock market crash in cludes insider-trading and off-loading of shares by directors of the caller, absence of circuit breaker in the securities market, manifestation of unregulated rumors and sensitive information, lack of attention given by investors to the coition between stock price and company fundamentals, weak regulatory carcass to name a few. The diagram below shows clearly the catastrophe that took place during 1996.Figure 1 DSE General Price Index (DGEN) 1993-2007 (Source IDLCSL)On November, 2001 the DSE introduced the bench mark price barometer DSE General Index (DGEN) with a base might of 817.62 points. The index excludes companies of Z category and is calculated on the basis of price question of individual stocks. Figure 1 displays the periodical DSE general index from the year January 1993 to November 2007, the latest month for which the data was available. From the diagram we can tell that the market behaved irrationally during the year 1996.The DSE all share price index come up fr om 832 in 1 January 1996 to 3567 in 14 November of the same year, i.e. DGEN rosiness from 1106 to 4738.83. This dazzling rise in DSI was followed by a drastic fall to 2261.47 points in the last week of December 1996 and again to 1140.65 points on April 1997. The market was aristocratical for a long period of time after the 1996 collapse but between July 20003 and June 2005, DGEN more than doubled from 823 to 1727. It appears that the index is performing modestly in the current year followed by an uptrend as it shows an increase in the index from 1527.29 in November 2006 to 3011.60 in November 2007, reaching its pinnacle after 1996.The devastating memorial of 96 crashes still persists in the mind of potential investors but without fix participation the market cannot sustain in the long-run. Also it needs to involve back the foreign investors that fled in the 1996 debacle. Inflows of foreign direct investment need to be restored to stabilize the economy.From the statistical data below in remit 1 it can be observed that foreign investors are to the lowest degree attracted to the securities market of Bangladesh. There were significant foreign investment inflows into equities in the year 1994 amounting to $ 106 million but by the mid 1997, most of the foreign portfolio investors had divested holdings and have not since returned.The following table contains the key capital market indicators reflecting that the grand of primary market development had been fluctuating and the markets contribution to resource mobilisation of the economy trunk below potential and the secondary market remained stagnant during 1997-2003 but showed some sign of recovery in 2004. Overall, investor confidence has not yet fully recovered. fudge 1 peachy Market Indicators- Dhaka Stock ExchangeItem199319941995199619971998199920002001200220032004No of ListedCompanies143157183186202208213223231242248337Market CapIn taka (mn)1809941771565181681067130250254447896293263777712699758722492 3In $ (mn)4551038140939601569103688111691119122916853709Market Cap as% of GDP1.443.083.7110.113.952.512.042.652.522.613.256.76Significance of large(p) Market for Economic DevelopmentSignificance of crown Market for Economic DevelopmentAn Explotary Study On The Significance of Capital Market for Economic Development and Its Further Growth Potential In Context of BangladeshAbstractThis research paper investigates whether the role of capital market is significant for the economic development of Bangladesh. Literature suggests that well developed stock market can provide an extra impetus to economic activity. confusable conclusions were also drawn from the in-depth interviews. This paper also reveals a well-scanned scenario of the capital market highlighting its setbacks, current weakness, recent improvements and its prospective signs of development through which we can foresee whether the capital market has further growth potential or not. Thus the present study can also contribute in providing essential information that can also be used for further research.AbbreviationsADB- Asian Development BankCDBL- Central Depository of Bangladesh Limited CDS- Central Depository SystemCSE- Chittagong Stock ExchangeDGEN- DSE general indexDSE- Dhaka Stock ExchangeGDP- gross domestic productIPO- initial public offeringSEC- Security and Exchange Commission1.0 IntroductionThe financial market contributes to the economic growth and development by providing the needed finance for provision of goods and services. The financial market consists of two division- money market and capital market. The money market is basically entitled to supply finance on short-term basis to individuals, businesses, enterprises, government and their agencies. The capital market, on the other hand, provides finance on medium to long-term basis to corporate bodies, government and their agencies (Al-Faki, 2006).Capital Market plays a crucial role in any modern economy as they allow investors fund to flo w to the most promising opportunities, i.e., the funds are mobilized and channeled efficiently from savers to the users of funds (Al-Faki, 2006 DSE, 2006 Hubbard and Thornton, 2006 Ahmed, 1997). In Bangladesh financial intermediation relies for the most part on the banking sector which further resulted in lack of equity financing (Salahuddin Ahmed, 2007 Islam and Hassan 2002).Furthermore out of 5 million urban-based middle class people only four hundred thousand are participating in the securities market and among them roughly hundred thousand are active investors. A large portion is still ignorant of the nature and benefits of the capital market (Abu Ahmed, 2006 DSE Review, 2006 Islam and Hassan, 2002).Developing more complete and deeper capital market would enhance a countries growth potential and innovation (Andritzky, 2007). The forces of globalization, technology, new forms of competition have perceptibly transformed capital market worldwide (Hassan, 2004). The chief advisor Dr. Fakhruddin Ahmed give tongue to that Only a vibrant and well-regulated capital market can transport sustainable economic development in the country through making the real sector capable of meeting the challenges of the competitive global economic realities ( DSE Monthly Review, June 2007).Regardless of recent improvements, Bangladeshs capital market remains underdeveloped as its size is still very small in terms of market cap (ADB, 2006 Salahuddin Ahmed, 2007 Islam and Hassan 2002). The market cap represents just above 9% of the GDP (Dr. Fakhruddin Ahmed retrieved from DSE Review). As Bangladesh capital market is still quite small compared to other regional market and to the size of its economy (CSE, 2006) scorn its existence for a long time, this paper applies a framework for analyzing the significance of capital market for economic growth and development of Bangladesh, identifying its growth potentials through exploration.2.0 Problem StatementBangladeshs capital market is still underdeveloped, in spite of recent improvements. The size of the countrys capital market is quite small mainly due to the excessive dependence of leading corporate entities on the banks for financing. Moreover the overall transparency of market dealing is also low compared to international standards and generally there has been slow development of the underlying market infrastructure.The government is making effort to develop the reliability and efficiency of stock exchanges as investment market. Compared to the other neighboring countries the poem of participants are much smaller in Bangladesh as investor lack confidence. There is a supply side constrains in the capital market as quality shares are lacking. For all this reason this research is done to explore the importance of capital market in the economy and what are the prospective sign of development of the stock market.3.0 Purpose of the StudyThe purpose of the study is to explore a well scanned scenario of Bangladesh capital market, its significance and its prospects. Although some research has been conducted relating to this topic but there is little empirical evidence about how essential stock market is to economic development of a country.A sound capital market prompts better economic base and influence its future growth and so it can help realize Bangladeshs growth potential. The capital market of Bangladesh is on the brink to play its due role as a medium for financing investment and thereby making a notable contribution to economic growth, employment unveiling and poverty alleviation.The capital market plays an important role in quickening the pace of economic development but the existing state of the capital market is under-developed and not in a position to ensure economic progress of the country. Hence this research will try to highlight the significance of capital market for the nation and explore what are the probable signs of progress.4.0 Research Timeline2007 SeptemberWriting Rese arch Proposal2007 SeptemberDeveloping Literature Review2007 OctoberCollecting Data2007 October- NovemberData Analysis and translation of the Findings2007 NovemberPreparing Draft and Finalizing the Research Paper2007 DecemberSubmission of Research Paper5.0 Limitations of the studyDuring conducting the research I came across certain limitations and among them the foremost one is time constrain. Although I got the opportunity to work in an organization that is capital market based but it was difficult to find spare time that could be used for the report. Moreover the interviewed person could not provide all necessary information due to lack of time.The research timeline also reveals that time constrain was actually a barrier as there was plenty to find about this research topic. As the research is conducted for the first time, I did not mystify much support from previous research paper and further research is suggested. A huge portion of the report is based on secondary data collecte d through websites and so the depth of reliability varies as by the nature of website.6.0 Review of the Literature6.1 Financial IntermediationAccording to Joseph Yam (2004) financial intermediation is channeling savings into investments. Aziz and Duenwald (2002) referred that financial intermediation affects growth through the following channels (i) it can increase the marginal productivity of capital by collecting information to evaluate alternative investment projects and by risk sharing (ii) it can raise the proportion of savings channeled to investment through financial development.According to Conning and Kevane (2002) intermediation implies an intermediary. Gorton and Winton (2002) added that it is the informant institution in the saving investment process. They referred that financial intermediaries are firms that borrow from those who have excess money, that is, the savers and lend the money to companies that need resources for investment.6.2 performance IndicatorsAccordin g to R. N. Agarwal (2000) the most commonly used standard to measure the size of a countrys stock market is market capitalisation ratio, that is, the ratio of market value of stocks which are currently listed on a bourse to Gross Domestic Product (GDP). A small ratio of capitalization to GDP reveals the small size of a stock market. Alternatively, the size can be measured by the number of listed companies on a stock market. The height of maturity of an economys financial system is essential for economic development.Bekeart et al., (2007), Hubard and Thornton (2006), Rosul (2002) all investigated the significance and relation of stock market development with the economic growth and their conclusion suggests that capital market development is positively correlated with long term economic growth and the capital market plays an important role in the economic development of any country. The size of the equity capital market has an optimistic effect on economic growth of the country, that is, much higher market cap and turnover has a major positive influence on the economy (Institute for Advanced Studies, IHS, 2006).It is seen that the ratio of market cap to GDP in neighboring countries like India, Pakistan and Sri Lanka is comparatively much higher, that is, more than 60% of their GDP (DSE, Kh. Asadul Islam, 2007 Dr. Fakhruddin Ahmed,2007). In Bangladesh the market cap is very small proportion of the countries GDP (Islam Hassan, 2002) and this is due to significant dependence on the banking sector (DSE Review, Fakhruddin Ahmed, June 2007).Market capitalization as a share of GDP was around 2.5%-3.3% during 2001-2003 compared with 1.4-10.1% during 1993-1996 and 2- 4% during 1997-2000. However in the year 2004 market cap reached 6.8% reflecting the rise in the DSE index from 968 to 1,971 at the end of 2003 and 2004 respectively (ADB, May 2005). The trend of market cap as percentage of GDP and other capital market indicators of DSE and CSE are shown through the help o f statistical data represented in the discussion section in Table 1.Despite the existence of the bourse from 1954, the capital market still exhibits features of an emerging equity market (Islam Hassan, 2002). The finance sector is immensely bank-based (Salahuddin Ahmed, 2007) as resource mobilization for industrialization and economic development is made primarily through the level(p) banking system (Islam Hassan, 2002).Borrowing requires fixed payments and over-reliance on banks can cause character default risk. According to (Mochammad Rosul, 2002) excessive reliance on bank acquire results in a mismatch with long-term investments being financed with short-term bank loans. He added that such a risky situation can further contribute to the economic crisis and so the job of the principal fund supplier for business should be transferred from banking sector to the capital sector.6.3 Regulatory Bodies6.3.1. The Security and Exchange Commission (SEC)The Security and Exchange Commiss ion (SEC) exercises power under the Security and Exchange Commission Act 1993 and established on June 8, 1993. SEC, the sole Capital Market Watchdog and Regulator, has been pursuing a vigorous capital market development process including amendments of its existing regulations, conduction of investor awareness programs, rigid monitoring and surveillance to bring in transparency in the trading mechanism (SEC, Annual Report 2003 -04).The responsibility of SEC includes the followingRegulating the functions of Stock ExchangesRegistering and regulating the business of stock brokers, sub broker, share transfer agents, underwriters, registrar, portfolio managers, investment advisors, and other middlemen related to security dealings.Registering, controlling, and monitoring of all types of mutual fundsControlling and monitoring of all authorized self regulatory organizationsProhibiting ambidextrous and unfair practices related to securitiesPromoting investors education program and providing training of intermediariesRegulating substantial acquisition of shares and takeover of companiesSEC are detects market purpose and also keeps constant vigil on the activities of stock exchanges to ensure military posture of the surveillance system.Conducts research and publishes information for above purposes(Source Security Exchange Commission Website www.secbd.com)6.3.2 Stock Exchanges6.3.2.1 Dhaka Stock Exchange (DSE)On April 28, 1954 DSE was first incorporated as the East Pakistan Stock Exchange Association Limited. Formal trading began in 1956 with 196 securities listed on the DSE with a total paid up capital of about Taka 4 billion. On June 23, 1962 it was renamed as Dhaka Stock Exchange (DSE) Limited.After 1971, the trading activities of the prime bourse remained suppresses until 1976 due to liberation war and economic policy pursued by the then government. Trading resumed at DSE in 1976 with only 9 companies listed having a paid up of Taka 137.52 million (Bashar et al., 20 00 M Farid Ahmed, 1997). As of today there are 342 listed companies in the prime bourse with market cap exceeding 700,000 million (DSE, 2007).The reforms that DSE undertook recently for ensuring professionalism and transparency focused on the trading of securities. The measure were taken to implement transparent trading system, efficient reporting of trade, real time delivery of information, strong surveillance and monitoring over trade of securities and settlement of shares (Rahman,Uddin and Malik, 2006).6.3.2.2 The Chittagong Stock Exchange Limited (CSE)The CSE is the countries second bourse that started its operation from the year 1995. It is also a self-regulatory non profit organization. Currently the poem of listed securities are 223 of which the number of listed companies are 208, mutual funds 14, and one debenture.6.4 Recent Capital Market Scenario of BangladeshAccording to Dr Fakhruddin Ahmed (DSE, 2007) political uncertainty, corruption and lack of transparency in all sec tion of the social and economic fabric are some of the reasons for capital market deficiency. Bangladesh Governor Salehuddin Ahmed (2007) reveals that foremost problems include political instability, under developed infrastructure, poor port management, short comings in well-grounded system and corruption (Financial Express Report).On the other hand DSE general share price index reached its pinnacle and crossed 3000 points (Newage www.newagebd.com). In particular the capital market witnessed a robust growth in the current year. Both turnover and market cap crossed new milestones at Tk 3000 million and Tk 700,000 million respectively during the year (DSE, 2006 DSE, 2007, IDLCSL). Recently our market cap crossed USD 10 billion that accounts for only 13% of its GDP which was only 8% a year back. (DSE Monthly Review, Oct 2007).Though the contribution of capital market to GDP is still inadequate when compared to neighboring countries but still its increase is significant for the develo pment of our economy. Comparison of indices and market cap among different countries is shown in Table 2 and Figure 2 in the discussion part. Entry of 12 new issues worth Tk 11,322.95 million helped raise the market cap.Some of the reason for the progress in capital market development is central depository system and the automated trading system (ADB, 2006 SEC, 2005). The DSE has upgraded its automated online trading system and investors are able to trade from different split of the country (SEC Quarterly Report, April-June 2007 ADB, 2006). Another reason for the vigorous improvement of the equity capital market is due to strenuous efforts taken by the SEC that further boosted investors confidence (DSE, 2007).7.0 Research Methodology7.1 Research DesignThe present study endeavored to explore importance of capital market for the economic development of Bangladesh and its future prospects. Exploratory research is selected as research design as little information exists about the capit al market of Bangladesh. The aim of alpha research is mainly to gain enough information before doing more thorough research. We basically start by gathering as much information about the object as possible and with a umbrageous impression of what we should study (Cooper Schindler, 2003).7.2 Research InstrumentThe research was conducted using both primary and secondary data. For collecting secondary data, various books, websites, newspapers, annual reports, monthly reviews and significant articles were chosen. Also for collection of primary data in-depth interviews with a tell of designated professional, related to this field, were taken.7.3 Data CollectionSecondary data used in the paper has been collected through access of different source of books, journals, publications of DSE, SEC, ADB and other news paper and articles. The DSE and SEC library were visited to acquire secondary information. versatile websites were browsed to collect relevant articles that are circulated on o nline sites. For collecting primary data, in-depth interviews of undergo people related to this field ofcapital market were taken. Appointments were fixed initially and then the interviews were taken. The interviewed persons are Kh. Asadul Islam, CEO, IDLC Securities Limited (IDLCSL) Anwarul Kabir Bhuiyan, SEC, Executive Director Tania Sharmin, SEC, Assistance Director (Surveillance) Abul Ehsan, Senior Officer, IDLC Finance Limited Moumita Manzoor, Research Associate, IDLCSL.Each of them was interviewed for 40 proceeding approximately during the office hour while taking break from work. They were asked some essential questions associated to this research topic. Some of the questions that were asked are as follows-What is the role of capital market in the economy?What are the setbacks of the stock market in Bangladesh?Explain the current scenario of the capital marketWhat are the prospective sign of the development of the capital market?How can we be sure of a sound growth of capita l market in Bangladesh?Do you see a better or worse scenario ahead of us and why?8.0 Discussion8.1 Role of Capital Market in the EconomyAccording to Dr. Mirza Azizul Islam (2006) capital market can play an essential role in enhancing economic development through efficient intermediation of savings into cultivatable investments and in encouraging the expansion of private entrepreneurship (DSE, 2006). The primary market can contribute to the growth of private entrepreneurship by facilitating the entrepreneurs to raise funds from excess savers and consequently finance investment in a cost-effective manner.For instance, if an industrialist with a viable new investment or expansion proposal is unable(p) to execute his plan due to financial crisis then he can issue securities to meet the required deficit. Moreover issuing shares have the supernumerary advantage that they do not create fixed charges for the companies issuing them and and so endows a better option than, say, financing through bank loans. A proficient and vibrant secondary market can also contribute copiously to economic growth.If a company, for instance, is well-managed and the secondary market prices are higher than face value, subsequent rights issue can obtain premium. Therefore the company can finance its development plan in lucrative and cost-effective approach. So the capital market not only provides opportunity for companies to borrow funds needed for long term investment purposes but also provides avenue for the marketing of shares and other securities in order to raise mellifluous funds for expansion of operations, leading to increase in output or productivity.The equity market offers opportunity for government to finance projects aimed at providing essential amenities for socio-economic development. Such market encourages inflow of foreign capital when foreign companies or investors invest in domestic securities. The securities market can help attain higher productivity by restructurin g of ownership and management of the company as secondary market provides an exit option for the original founders and it also creates an avenue for the populace to participate in the corporate sector of the economy and share in its wealth through ownership of securities.So it not only reduces the over-reliance of the corporate sector on short term finance for long term projects but truly makes available the needed money for venture capital development which could serve as a vehicle for industrial development. So through its allocating mechanism, the capital market ensures an efficient and effective distribution of scarce financial resources for the optimal benefit to the economy.8.2 Major Setbacks of the Capital MarketInvestment in capital market is limited to a small proportion of the population. Investors confidence in the capital market has not entirely recovered since the stock market crash in 1996. percentage market debacle in 1996 was mainly the result of market exercise b y a section of stockbrokers in collaboration with some other market participants (SEC, 1997).Some of the other notable reasons behind the stock market crash includes insider-trading and off-loading of shares by directors of the company, absence of circuit breaker in the securities market, revealing of unregulated rumors and sensitive information, lack of attention given by investors to the relation between stock price and company fundamentals, weak regulatory personify to name a few. The diagram below shows clearly the catastrophe that took place during 1996.Figure 1 DSE General Price Index (DGEN) 1993-2007 (Source IDLCSL)On November, 2001 the DSE introduced the benchmark price barometer DSE General Index (DGEN) with a base index of 817.62 points. The index excludes companies of Z category and is calculated on the basis of price travail of individual stocks. Figure 1 displays the monthly DSE general index from the year January 1993 to November 2007, the latest month for which the data was available. From the diagram we can tell that the market behaved irrationally during the year 1996.The DSE all share price index rose from 832 in 1 January 1996 to 3567 in 14 November of the same year, i.e. DGEN rose from 1106 to 4738.83. This indiscreet rise in DSI was followed by a drastic fall to 2261.47 points in the last week of December 1996 and again to 1140.65 points on April 1997. The market was downhearted for a long period of time after the 1996 collapse but between July 20003 and June 2005, DGEN more than doubled from 823 to 1727. It appears that the index is performing modestly in the current year followed by an uptrend as it shows an increase in the index from 1527.29 in November 2006 to 3011.60 in November 2007, reaching its pinnacle after 1996.The devastating storey of 96 crashes still persists in the mind of potential investors but without tidy sum participation the market cannot sustain in the long-run. Also it needs to bring back the foreign investors that fled in the 1996 debacle. Inflows of foreign direct investment need to be restored to stabilize the economy.From the statistical data below in Table 1 it can be observed that foreign investors are least attracted to the securities market of Bangladesh. There were significant foreign investment inflows into equities in the year 1994 amounting to $ 106 million but by the mid 1997, most of the foreign portfolio investors had divested holdings and have not since returned.The following table contains the key capital market indicators reflecting that the pace of primary market development had been fluctuating and the markets contribution to resource mobilization of the economy remains below potential and the secondary market remained stagnant during 1997-2003 but showed some sign of recovery in 2004. Overall, investor confidence has not yet fully recovered.Table 1 Capital Market Indicators- Dhaka Stock ExchangeItem199319941995199619971998199920002001200220032004No of ListedCompanies 143157183186202208213223231242248337Market CapIn taka (mn)18099417715651816810671302502544478962932637777126997587224923In $ (mn)4551038140939601569103688111691119122916853709Market Cap as% of GDP1.443.083.7110.113.952.512.042.652.522.613.256.76

PEST(EL) Analysis of Finland and Chine

PEST(EL) Analysis of Finland and ChineFinland is a parliamentary republic g e preciseplacenment with a multiparty political system based agricultural genius by the head of state which is the president. Finland president hold a closure of 6 twelvemonths precondition with maximum two consecutive term elected by the Finnish. Both the visor Minister and Deputy Prime Minister dominated by the president after the parliamentary elections. They ar the head of g overnment and having the executive power to the government including the EU issues.Women in Finland atomic number 18 treated fairly great. They represented 38% of the seats in the 200 members of parliament in the year of 2003. Besides, part of them holding all important(predicate) positions equivalent foreign minister, speaker of parliament and so on. The most material position of Finnish ladies ever hold is president in the year 2000 by Tarja Hal iodinn and primes minister by Anneli Jaatteenmaki in March 2003.Economic Fact orsFinland is a highly industrialized country with GDP of $181.4billion in year 2009, over 40% from the GDP be from the contribution of exporting effectives and services. The primary delivery vault of heaven in Finland is service sector which contribute about 65.7% and detected by manufacturing sector in producing metals, chemicals, and so on.Taxation system in Finland is very difference with the different countries. Finnish hold their own tax nonice to prevent the card holder from getting highly taxed by their government. Those mint without tax card are taxed 60% from all the income they obtained.The most earthshaking effort in Finland is Nokia, which is peerless of the world largest and notable mobile ring producers. Due to the highly success of the development of Nokia in Finland, this enable Finnish have the opportunity to own mobile phone and in any case link up to the internet much earlier before this ferments common in the united Stated and other countries i n the world.Social FactorsFinland hold the population over 5.32 poor boyion inhabitants, a part from the whole populations, there is 2.7million of them are manpower and 2.5 million from them are employed. Public sector is the most popular sector the Finnish to contribute in. Major ethnics group in Finland include Finns, Swedes, Lapps, Sami, Roma, and Tatars, and mass of them roughly about 91% speak in Finnish. Besides, large numbers pool of them are believed in Lutheran.In the tuition system of Finland, children who r all(prenominal) the jump on of 9 years old are compulsory for them to start school day. The attendance and literacy rate in Finland are almost hundred percent. This is among the higher in the ranking of education index in the word. Free meals will be provided for students who study in primary and secondary schools. Besides, the government absorbs the tuition fees, which mean(a) there are 0 tuition fees for their full time students.technical FactorsStaying ahead Finland has long been recognized for the success of the work it has done to make head route innovation and the results speak for themselves in many disciplines. Finland cannot afford to rest on its laurels.This identified a number of shortcomings, most specially in the area of business support and making it easier for small businesses and start-ups to access the support and incentives that already exist. Finland has international links that need to be potentialityened in research, the university world, and business. population able to tap into the dynamism of the globalization process going on around us much soundly is a challenge set about many other countries as swell as Finland. Staying ahead of the contender is a must.Greater sustainabilityOne of the constitutional trends under way and one highlighted by Tekes, the Finnish Funding Agency for Technology and Innovation is the outgrowth emphasis on the need for greater sustainability and reducing unnecessary wastage of the worlds diminish natural visions.Addressing this challenge will call for a barf of peeled innovations based on a much lower level of resource usage than we accept today, innovations that have a smaller footprint crossways the entire life cycle of products and services. The need for these types of innovations is perhaps most pellucid in areas such as renewable postcode, but in conclusion it is similarly likely to be felt crossways all the products and services that wad interact with in one way or another.Clean engineering scienceFinland has already made great strides in developing energy-efficient systems and technologies, and is committed to doing more in this area. The country is expected to be one of the fastest-growing renewable energy markets in Europe over the succeeding(a) five years, and wants to be one of the EUs leading users of renewable energy per capita by 2020.A number of initiatives are under way to promote the development of environmental technologie s and services in Finland, including the Cleantech programme and the new strategical Centre for Science, Technology and Innovation that has been created to sharpen on advanced RD in the energy and environment sector, alongside the other five centres already in place.Known as CLEEN, its research agenda will address issues such as carbon-neutral energy generation, distributed energy systems, sustainable fuels, smart grids, efficient energy use, resource-efficient fruit technologies and services, recycling, and waste management. level-headed Factors eudaimonia State and Rule of Law form the BasisFinland is a welfare state. The state and the municipality of residence have to guarantee everyone a worthwhile existence and offer equal opportunities for a balanced and active life. People also have to have sufficient chouseledge of their rights and responsibilities. A system of profound safeguards guarantees that these rights are upheld. Societal stability, the quality of the judicial system, faithful governance and effective efficacious safeguards are important competitive factors in ever more global and integrated markets.Strategic Action towards 2012 at bottom Legal indemnityIncrease the flexibility of legal proceedings.Improve the equality of the citizens in legal safety cases.Improve the efficiency of crime legal profession and broad-based criminal policy. break in support and compensation systems for crime victims.Rapid enforcementum of criminal responsibility.Increase the prevention of disruptions of payment.Improve the fairness and efficiency of the collection of claims.Assess the up-to-datedness of family and inheritance legislation.Strategic Action towards 2012 on Governmental LevelStrengthen structures supporting good honor drafting.More effective evaluation of the alternatives to and effects of legislation.Support cooperation in order to create functional democracy.Create opportunities and forms for civil participation.Promote the enforcement of rights within the EU.Stress the development of practical forms of cooperation for the prevention of international crime.Emphasise clarity, transparency, good governance and the protection of implicit in(p) rights in the activities of the EU.Why do you speak out Finland tops the chart for overall ranking of the Best Countries in The innovation?Finland education is ranked number 1 in the world. Finland has set education as a national precession and believes that future generations do not have prospects for a healthy lifestyle if the population is not well educated.Finland quality of life is ranked number 4 in the world. The amount of living in Finland is better. The Finland citizen has lots of holidays so families can actually shake off time together.Finland miserliness dynamism is ranked number 8 in the world. Finland or the Republic of Finland has a mixed economy which is highly industrialized. The country located in the northern Europe has rich natural resources like gold, silver copper, timber and limestone. The country also has deposits of iron, lead, zinc, chromium and copper across the country. Service, which is the largest economic sector of the country, forms more than 67 percent of the total and the next sector, manufacturing accounts, for more than 30 percent of the economy of Finland.PESTEL Analysis for China governmental FactorsThe primary system in China is socialist system. The nature is the fundamental law of the state and entitled with the highest legislative power. All other laws and regulations shall be consistent with it. It has been amended four times since its adoption and will be continuously optimized to better suit the changing environment. The National Peoples Congress (NPC) is the Chinas fundamental political system. It is composed of representatives from provinces, autonomous regions, direct municipalities and the military. Chinese Communist ships company (CPC) is the ruling party with other eight political parties. The eigh t parties are parties participating in the discussion and management of state affairs in cooperation with the CPC instead of parties in opposition. This leads to relative stable politic in China.A unique form of political risk occurs in China, and this is the constant betrothal between the countrys central government and the provincial and topical anaesthetic governments over applicable law, and observance or non-observance of it. This makes companies operating in China hard to know exactly what the rules are.Economic FactorsSince 1949, the Chinese government has adopted planned economy system for 30 years. Though this system contributed to the stable, planned developments of the Chinas economy, it also limit the economy development and sapped its vitality. The Chinas economic reforms began first in the plain areas in 1978 and shifted to the cities in 1984. The implementation of reform transforms Chinas economy into a socialist market economy. China is the fastest growing major economy in the world, with an middling growth rate of 10% for the past 30 years. Chinas embrace of the knowledge domain Trade establishment and foreign direct investment is unprecedented and contributes significantly to its growth success. China overtook Germany as the worlds biggest exporter of goods in 2009. Its booming investment and phthisis are helping to rebalance the world economy although Beijing has refused to let the kwai rise against the dollar since the global financial crisis began in mid-2008.However, there is legion(predicate) weaknesses challenge the economic growth of China. One of the most serious weaknesses is the impinge of interests between central government and local government. Local officials primary priority has been to promote themselves and their careers by pushing for high investment rates and end product levels whereas central officials are more concerned with excessive investment, unsold inventories, and local policies risking nationwide price in flation. Besides, corruption is mainly a government phenomenon in China. Corruption e redundantly affects government handling of a wide range of local problems such as economic reforms and the need to compensate losers in the process of unexampledization.Social FactorsThere are around 1.3 billion inhabitants in China. The Chinese government tries to control its population growth by morose family planning policy, with the goal of one child per family. However, the policy is conducted with exceptions in rural areas and for ethnic minorities. For religion, Buddhism is most widely practiced, with an estimated 100 million adherents. Traditional Taoism also is practiced. China is still an industrializing agrarian society and has a long way to go to attain an industrial society, so most of the populate do not have access to the best of Chinas recent improvements. Most modern Chinese young adults do not go to college, to which entrance is obtained by passing the Gaokao, a standardized te st at the end of the year. In the year 2000, less than 50 percent of the population finished junior(a) high, and less than 15 percent finished senior high or vocational school. In 2000, only 3.6 percent of the population went to college. Amongst high school and vocational school graduates, less than one tenth had the chance to go to college. There is one private car per 120 people. In China, people with associates degrees and above comprise less than 5% of the population.Technological FactorsCement industry of China has many technological advances compare to other countries. China cement industry focuses on energy-saving, consumption reduction, environmental protection, quality and productivity improvement, and unmortgaged and intensive production for sustainable development. China has developed 60 types of special cements with independent intellectual property rights such as high strength cement, silicate cement, and oil well cement. New suspension preheater (NSP) sintering syste m is the main treat equipment of a NSP cement production line. China has been developed advanced NSP technologies of 1000-5000 t/d sintering systems. The design of 10000t/d NSP sintering system has also been completed and triad production lines are under construction. Electricity consumption of cement production largely depends on grinding process in normal circumstances. In China, the combined power consumption of NSP plants has decreased from 125kwh/t in the mid-eighties to 95kwh/t today in some modern plants, mainly collectable to the adoption of advanced technologies and equipments, such as advanced roller mill and high efficiency separator. Environmental FactorsThere are some true environmental issues in China. Poor land management and excessive industrialisation on fragile grasslands is driving to desertification in China. Besides, the modality change is vexing the problems. Unrestrained development and industrialization throughout the country makes China particularly v ulnerable to growing changes in the climate due to rapidly change magnitude levels of greenhouse gas emissions in the worlds atmosphere. Desertification is engulfing ecosystems with sand and reducing already extraordinary arable land and creates eco-refugees. Chinas economy based mainly on heavy(a) industry and coal for cheap energy emits high levels of greenhouse gases, ultimately accelerating global warming and climate change. To alleviate the short-term effects of climate change, China has started to use artificial precipitation and other experimental means. The Chinese government also has begun to adopt stricter energy conservation legislation and step-up and international cooperation to combat threats that climate change may bring to China.Legal FactorsThe judiciary in China means law-enforcement activities conducted by the countrys judicial variety meat and organizations in handling prosecuted or non-prosecuted cases. Sources of law are as follow1982 Constitution of the P eoples Republic of ChinaThe Constitution of the PRC guarantees the basic rights and interests of citizens. Chinas Constitution has been amended for four times since its adoption in 1982, most tardily this year on March 14, 2004 when the National Peoples Congress voted to include baronial guarantees of human rights.NPC Statutory Law and Other Legislative EnactmentsChina has intensify legislative action on enacting and revising laws and regulations in accordance with its having become in late 2001 a member of the World Trade Organization (WTO). Up to the end of 2003, around 440 laws and law-related decisions enacted by the NPC and its Standing Committee, more than 1,000 administrative regulations enacted by the State Council and 10,000 local ordinances had been formulated.International TreatiesThough the 1982 Constitution does not specify the treatment of international law in relation to the laws of the PRC, in practice the legislative approach has been to automatically incorporate international law as part of PRC law. If, however, the PRC has made a mental reservation to a provision of a agreement, this aspect or provision of the treaty is not implemented in the law.Case LawIn theory, each case stands as its own decision and will not arrest another court. However, in practice lower peoples courts judges often feat to follow the interpretations of the laws decided by the Supreme Peoples Courts.

Germanys Refugee Intake

Germ anys Refugee IntakeGer some(preno(prenominal)inal)s crucial pre disco biscuitse in aiding refugees and limitations rebelIntroductionA streamline of images appe ard on the television set screen located in the sustainment room of a German household. Various colors from the reinvigorateds segment on Syrian refugees reflected on the faces of the viewers. The steeric of refugees was a highly discussed one by means ofout europium. Many of the refugees consisted of Syrians as a result of the Syria crisis that began in 2011. Germany has been one of the virtually prominent figures as their conk outicipation in assisting refugees has been high. Germany contacts the highest number of refugees, comp atomic number 18d to other countries in the world, with the join States, who is easily larger, coming in second (Marks, 2018). Germany has provided a people of assistance towards refugees as at that place ar designs, such(prenominal) as German language weapons platform and de signated housings as a part of topical anaesthetic desegregation. It is important to level that Germanys refugee policy is an important model (Nanette, 2016) however, on that point atomic number 18 implications that cut as in that respect whitethorn be limitations on how far the liberality of one unpolished flush toilet go. For endful, as wise batch bugger off in a land, the competition for markets such as the ones for jobs, increases signifi displacetly and this may create narrower job opportunities for current German citizens. As a result, nigh(prenominal) questions come up, with one relating to if it is okay to put the inescapably of others before citizens of the waiter country in any particular situation. Germany has been a good model of a country deprivationing to aid refugees and the events occurring in the country environ refugee ends but it is withal an unfortunate destination of being generous and do and it is restrictive at the national level. Migrant Crisis in atomic number 63 In the year of 2015, most more than than than one billion mess, including refugees, displaced persons and other migrators (European civic testimonial and Humanitarian Aid Operations, 2018). seduce haild in Europe, with hopes of a demote life because of constant scraps or few opportunities in their station country. These unsettleds arrive in Europe, typically after strenuous and draining journeys by primer or sea and upon arrival, they al coveys need service of process with basic tender necessarily such as clean water, health c atomic number 18, emergency cheer and legal. This large increase in number in like manner affects countries that ar part of the transit route such as bomb calorimeter, Greece and Libya as they receive large amounts of people at a period of time that exceeds their capacity. The top countries in which persons who argon applying for asylum Europe be from Syria (360,000), Afghanistan (170,000) and Iraq ( 120,000). The European country that had acquired the most asylum performances was Germany, a tally of 476,000 in 2017. in that respect atomic number 18 problems with the responsibilities sh ard by each country in Europe. This is because in that respect argon most countries in which much migrants arrive to, such as Greece, Italy and Hungary and this results in them taking in more responsibilities and using their resources. European countries stimulate indisput subject quotas established for the amounts of migrants that they can take from the transit countries such as Greece and Italy. Germany has the highest quota at 27,000, accordingly comes France at 19,000 and Spain comes in third with 8,000. Top countries in which people ar tending(p) asylum view ar Syria, Eritrea and Iraq. This from an economic thought which helps further instance the dangerousness of the crisis in poesy.Refugee Politics in GermanyFlchtlingspolitikor refugee politics in Germany is a topicdis cussed rampantly in the country. The German refugee policy is considered as admir up to(p) inmany ways because of its attempts of assay to fulfill its lesson duties torefugees (Nanette, 2016).There atomic number 18 many legalities of the policy taken from the GermanBasic Law, specifically expression 16a, where people extradite the right to asylum. Itstates that persons persecuted on governingal causal agency shall absorb the right ofasylum and this colligates to the issue ofrefugees. cardinal important laws of the refugee policy, the Asylum Law andIntegration Law, were created and passed on July 7, 2016. Through these policies, refugees atomic number 18first granted either asylum or protected refugee posture (290) for a durationof three historic period or the other excerption of subsidiary protection for but oneyear. They then go by dint of a series of regulations to determine their office inGermany. One of the restrictions overwhelm from this subprogram includes that if thecountry that they arrived from was considered a safe country, then they wouldmechanically face rejection and their future is decided, a scheduling fordeportation but there could a ban placed upon this deportation if it one of some(prenominal) reasons is compulsive such as if their life would be endangered,because of their health or conditions in their country. however so, there beproblems with establishing clear boundaries for these categories of what isconsidered as a safe country and what would be life-endangering and questions roughly who holds to decide the fate of these refugees wind too. At thisperiod, the refugees are non fully accepted, quite they are hurt or geduldete in German. In addition, theserefugees overly have the luck to observe further extensions for thecategories mentioned previously or attempt to have a invalidate of their decisions.Furthermore, there are specificrequirements to be granted asylum or protected refugee experimental conditi on as the refugeeneeds to fulfill having a reasonable fear of persecution in their countryof origin relating to several traits of race, religion, nationality, semi policy-making depression or membership of a particular loving group (Nanette, 2016). Andthose who want to acquire subsidiary protection, must have substantialgrounds for believing that they would face a real risk of expo current of suffering seriousharm in their country of origin, which does non exclude the conflictsrelating to transnational or internal arms. It is important to gain refugee statusas it is also necessary perquisite in order to have access to some benefits forrefugees to support their familys migration as well or allowed participationwith antecedency for job training and language courses. In Germany, the refugees are organizedinto spectacular buildings that are funded by the state but organized by orphic organization.They are ho utilise in these large buildings until they receive news or updates o ntheir status for asylum. There are many refugee housings throughout Germany andthey are located in various areas, from large cities to belittled towns (Nanette,2016), They are often cramped and in many buildings. Definitions for RefugeesIt is important to card that there are establishments of the definition of who are regarded as refugees, even though in many places like Germany may regard the call refugee, asylum seeker and migrant as similar and use them interchangeably (OECD, 2018). However, it is essential to learn about the proper definitions of the terms to avoid any achievable confusions. Migrants basically treat any persons that relocate to a different country with the intention of staying for a certain period of time. Permanent and non- unchanging migrants with a valid abidance permit or visa, asylum seeks and undocumented migrants can fall down the stairs this term. Furthermore, refugees are persons who have completed their applications for asylum and have been gran ted a bit of protection, which can fall under formal refugee status harmonise to the Geneva Convention or to the German fundamental law. This term can also relate to other persons such as those that have participated in move programs that were facilitated by UNHCR, especially in the troops countries of Australia, Canada and the U.S. In addition, this term covers persons that have subsidiary protection. Subsidiary protection is typically granted to persons who have not qualified as a refugee but there are complications to their safety if they were to participate in repatriation or ease up to their kinsfolk country. The third term, asylum seekers define persons that have completed their applications for asylum, but are in the ferment of waiting for their results. Unlike other Organizations for Economic Co-operation and ontogenesis (OECD), Germanys process for asylum registration has dickens tiers. First people are required to complete their registrations as prospective asylum a pplicants and then they allow for be able to file an asylum request. However, there has been few problems and complications that came from this two-tiered process as the amounts of requests has increased, so there have been considerable delays in asylum seeking in Germany.Solutions for RefugeesThe United National mellowed Commissioner for Refugees (UNHCR) has detailed several categories that are used in the process of decision practical and feasible tooth roots for the problems of refugees. These categories include legal, economic, social/ heathenish and civil/political processes. round things that need to be considered are the legalities such as rights that the refugees are designated that include basics rights such as right to work, freedom of consummation and etc. (Refworld). When regarding economic factors, refugees should have the luck to participate in the topical anesthetic work force either through jobs or self-employment and have access to land, acess to financing or credit and etc. Furthermore, some features in the social or heathen process are that the refugee should be accepted by the phalanx company and State into the community without fear of discrimination and they should have the opportunity to the establishment of joint businesses and access to community c reads. Leading to civil or political processes, there should also be the right to participate in civil society, which includes being able to have the opportunity to government jobs and participate in the processes of elections. Even so, refugees could single be granted these rights or supervised by the UNHCR if they are mandated by them, which requires a long process to get to.The United Nations High Commissioner for Refugees (UNHCR) details several resolvents for the refugee crisis. The first root word involves voluntary repatriation, which is essentially, refugees returning back space if it is deemed safe. However, this solution has little execution of instrument because o f the problems with numerous amounts of refugees not being able to simply return because of current conflict, wars or persecution in their rest home country. Another option would be resettlement in a different country. If voluntary repatriation is not a viable option. This solution encompasses several programs to help refugees with settlement such as pagan orientation, language and vocational training and access to education and employment, which are important in helping refugees adjust in a new country. Even so, this solution is not often implemented as only when less than 1% submit for resettlement out of the replete(p) of 14.4 one thousand thousand refugees considered as concern to UNHCR. If the two previous options do not get on to work for the refugees, then local integrating in a array country could work. This solution involves an passing complex process as it places a lot of responsibilities and weight on both the refugee and the host country that is helping. Even th ough this is the case, there are also affirmatorys as the refugees that settle into their new host countries can positively contribute in a social and economic manner. This solution appears to be the most used, but it is not the most legal as there are complications. There is a total of 1.1 million refugees that have taken this route throughout the prehistoric ten years.VoluntaryReparationThere will be a more detailed explanation of these three solutions that the UNHCR currently has in place. It is important to note that the term voluntary is taken seriously when discussing voluntary repatriation as it is important that this solution allows the refugee to make the decision to return to be free and aware. There should not be any pressures from any external sources and the refugee should not be convinced otherwise. Regulations are needed to appropriately measure this process as there needs to be the fulfillment that the refugee will return to physical, legal and material safety. UNHCR provides the framework for this process as it includes the responsibilities and roles involved. Some examples of the implementation of this solution include 4,600 Angolan refugees returning back in September 2015 and overall, 18,000 have returned since the year of 2014. Another example includes 5,000 Rwandans returning home in the year of 2015, totaling the number to 160,000 since the year of 2,000. Even though there has been somewhat some success with this solution, it is quite on a vitiated scale and it not used often. topical anaestheticIntegrationLocal integration is the second option for refugees. The document that supports and is important in providing the legalities and the basis for this solution is the 1951 Convention and its 1967 Protocol. After a willing and able State, such as Germany, decides that they will offer local integration prospects. There will be a comprehensive process that will determine how the solution will get played out and this is determined with a number of factors (UNHCR, 2018). These factors are determining for which groups would this option be the most viable or important to and these can include refugees born on a host countrys territory and they are at a high risk of statelessness or have no determined nationality. The host country should also be able to recognize the possible challenges that come from opening up their country to refugees, which could be ostracize impact of refugees living many years and tenners without a clear idea of possible options but should also sustainment in mind advantages as the refugees can create a positive impact as they invest in the country and contribute to the community, such as in economical ways. There have been some instances in the last(prenominal) in which countries have been willing but are not completely able to helpwith local integration as they do not have enough resources and as a result,need help from the larger community at an international level. The number of able and willing is so smallcompared to the rest of the options and this raises the question about whatcould be done about the other possible states that could help with characteristicsof willing and not able or not willing but able (UNHCR).An example of local integrationincludes Brazil as there has been a slack increase in refugees in the countrysince the year of 2010 and as a result, there has been the decrease ofemployment opportunities lendable. Some steps that were taken were that therehas been increased partnership with the private sector, to provide moreopportunities for jobs for the refugees and also with public and privateuniversities, to help support theeducation of the refugees, specifically higher(prenominal)-education.Local integration in Germany includesseveral projects such as leisure and enjoyment program, cultural and languages program, program for women and more(Bundesamt fr Migration und Flcthling, 2018). Regarding leisure and summercater programs,there are many opportun ities for refugees to get to know other civilians asthey participate in after- crop programs that involve music, dance or sports.This provides several benefits as it aids the process in refugees being able to be involved in the process of creatingsomething together and breaks down prejudices as others get to know the refugees andwill be able to make their own perceptions, instead of preconceived notionsfrom stigmatization. There are programs to help younger refugees to get merged into German society with special programs in gymnasiums, or highschools and cultural programs to help them get accustom to German cultures asthey interact with German students daily. There are also specialized programsfor women refugees as there are courses to also learn German and courses thatrelate to issues of everyday life, family, health and school. There are alsoadditional programs and services made available to refugees to help themcomfortably integrate into the German community.ResettlementThe thir d solution for refugees isresettlement and it is the option that is most widely used. This solution is important for refugees that arenot able to find sufficient protection in their home or asylum country. Resettlement has thepossibility of being an effective instrument for province sharing andinternational cooperation and this aligns with the principle of internationalsolidarity as it providespossibilities of options to help (UNHCR, 2018). Agreements indoors the resettlementumbrella can help with refugees that travel oversea to disem shut offk at coastal states. This is helpful as itdifferentiates responsibilities for initial receipt and processingarrangements from the provision of long term solutions. And this reason is nowmore important as resettlement being used as a solution has increaseddrastically as more States are kindle in hosting and more cases are beingsubmitted to UNHCR since the year of 2012.A case relating to resettlement involves Egypt and trafficking victims. S ince 2006, there have been many cases of smuggling of humans from Africa through East Sudan going into Israel, which originally began as a voluntary crusade and then progressed into kidnappings in 2010. Some actions that have been taken place by the UNHCR is resettlement to protect these victims. It is interesting to note that local integration was not a rea keyic option for this case because the UNHCR had considered that there were not any adequate services for treating severely traumatized victims of trafficking. The victims were given priority for the registration for refugee status and often resulted in the implementation of resettlement to another country (UNHCR, 2018). Germany has had a program with the solution of resettlement since the year of 2012 and before was only ad-hoc for resettlement. In the year of 2016, the admission target was 800 but increased to a upper limit of 14,300 the pursual year. Germany has had an annual amount 300 persons that participated in the res ettlement program from 2012 to 2014. There was a slight increase to a total of cholecalciferol in 2015. And Germany has plans to resettle a total of 1,600 in the following two years. Refugees arrive in German after going through the application process for resettlement from the UNHCR, who then grants mandate refugee status (UNHCR, 2018) and this appears to be the only way for admittance of resettlement for now.Effectiveness of theSolutionsDiscussing the effectiveness of thesolutions that UNHCR has for refugees and its implementation in aiding refugees, it has helped few but truthfully not have had alot of success. The solutions appear to work for a short period of time and isnot effective for long periods of time. Data show that out of the refugees thatUNHCR is accounted for, approximately 5.6million, there are only 3% that participated in voluntary repatriationand 1% that are resettled (UNHCR, 2018). In the past, voluntary reparation hasbeen the solution for the largest proportion of refugees, but the number ofparticipants in this solution has dramatically declined since the year of 2011 because of problems of conflicts in the homecountry not ceasing. . Some statistics to illustrate this are that the numberof participants change magnitude to 526,000 in the year of 2012 and to 414,000 a yearlater. As a result, only 6.5 million refugees were able to return to theircountry of origin in the past decade in comparison to the number of 14.6million in the decade before. Even UNHCR are discussing about how this solutionhas not been extremely effective as of late. Resettlement has only been able to have helped about 1% ofthe refugees and requires a lot of resources to implement. There havefrequently been low numbers of participants in this solution, reaching onlyabout 69,252 refugees in 2012 and 71,411 in 2013 (UNHCR, 2018). There areadditional problems as because resettlement requires so much resources thatthey have express availability and are only able to keep a restrictedamount, which further limits itsimpact. Furthermore, UNHCR estimates that 691,000 people neededresettlement in the following year of 2014. The host country with the mostacceptance of resettlement cases is the United States, about 67% of the toalcases, even so, there are not many host country participants in this solution.Some staff members of UNHCR reasons that a global consensus is thatresettlement is not the best solution because there were a small number ofrefugees that are aided and the process details so much rigor.Compared to the other solutions, it is the most catchy to measure the success of local integration because there are so many differing ways to define integration and there are also a lot of high political sensitivity in host countries. This solution involves a selection of categories such as legal, economic and/or social integration (UNHCR, 2018). UNHCR has been working on ways to improve this solution for refugees and has worked for better naturalizatio n statistics. Overall, approximately 431 host countries of asylum have granted citizenship to approximately 716,000 refugees. An important part of local integration is detailed in the 1951 Convention relation to the Status of Refugees and this includes that the refugees have the right to work but results of this have proven to be not quite implemented, as 28 States a part of the convention have placed restrictions for refugees regarding the right. In addition, it was difficult for some refugees to have got job opportunities as some states have made restrictions on this with a legal bar on employment. Generally, the three solutions detailed have not been extremely effective as exemplified by statistics in the past years. And this raises the question of possible improvements to these solutions or new additional solutions that could be implemented. Finding solutions for refugees is a difficult task and working out its implementation is even more so and has been proven a challenge for UNHCR and it host country participants.Addition of complemental PathwaysIn addition to these solutions, a questionarises about any possible additional solutions that could also be implemented. Furthermore, there are complementary pathwaysthat can be used in conjunction with the solutions (UNHCR, 2018). Thesepathways can be used to further help refugees reach the solutions that meettheir international protection needs. Some examples of complementary pathwaysare family reunification, especially for extended family members who do notmeet the guidelines of resettlement for a refugee or educational-based programsthat require communities and educational institutions to beget involved andregulate. Pathways are not limited to a level of stove and can be eitherlocal, regional or global and can be used in implementation to help alimited number of nationalities, professions and skills or other categories.Reason for MigrationConflict in Syria(journal on migration) Numerousamounts of Syrians have been fleeing Syria since 2011 as many conflicts appearas a result of the government of Bashar al-Assad and others. This creates aplethora of displacement that occurs throughout the war-torn country. In 2014,there were approximately 7.6 million Syrians that fell under the socio-economic class ofinternally displaced persons, people who have migrated without crossing bordersbecause of conflict and an additional 3.7 million left the country. In the sameyear, about one million Syrians were able to have their statuses as refugeesapproved. Even though many Syrians were granted refugee status in their hostcountries, there were still 117,590that were a part of the waiting process on being notified about their statusdecision. The conflict had a huge toll on countries that were nearby, such as Jordan, Lebanon and Turkey shouldering the largest perfume. This is especially illustrated in statistics, as Lebanon with a population of 4.8 million, has about a million Syrian refugees residing in the country, a 1/5 of their population. Furthermore, Turkey had the most Syrian refugees at 1.5 million and Jordan was in third with 500,000 refugees. The conflict has caused many problems relating to refugee issues, creating an inflow of migrants that are displaced.Refugee Situation inGermanyThere is a total of 7,594,000 persons in Germany with a migrant background and about 1,099,363 (DESTATIS) are from Turkey and 698,950 are from Syria. Furthermore, almost everywhere in Germany, people are discussing the topic of refugees, especially in the city of Berlin. Often these questions may relate to the physical characteristics of refugees as some are not quite sure what the refugees look like as in some areas, refugees are sometimes separated from other civilians for a period of time, in their designated housing. In the German state, there have been about one million refugees that have entered in the year of 2015 only and there was also the adoption of integration politics (Nanette ). Germanys policy on refugees has been somewhat established as a good and essential model for European refugee policy, however, it does have areas in which it needs improvement. In the years of 2015-2016, Germanyreceived the most asylum applications from persons from Syria, with a total of424,907 applicants (OECD, 2018). The next countries with the highest amounts ofapplicants for asylum in Germany were Afghanistan with 158,394 applicants andIraq with 125,900. Syrian applicants received a lot of recognition forobtaining asylum with a total of 98% of the total applicants, sequence only 56%Afghan received less recognition. This shows how some countries have morepriority over others as they gain asylum status throughout Germany, most likelydependent on the direness of their situation.Some more statistics on refugees in Germany include job-seekers, with Syrians being on top of the list with 252,231 persons (OECD, 2018). There are also statistics on the rates in which refugees are empl oyed. Only approximately 28% refugees that had basic or worse German language skills were employed, while 65% with intermediate German were employed, which is the same fate as those who were fluent. This illustrates the importance of obtaining or learning the German language for refugees in Germany as it increases job opportunities and that is why Germany has been making language programs easily fond to refugees, which includes online courses as well. Other statistics illustrate how the asylum seekers are distributed throughout Germany and its municipalities as it is dependent on the size of the population. The top three municipalities that receive the most are North Rhine-Westphalia (north-west) with 21.2%, Bavaria (central) with 15.5% and Baden-Wrttemberg (south-west) with 12.9%.In years of 2015 until 2016, Germany embarked on a pleasurable Politics of care for refugees and also Integration Politics supported by Chancellor Merkel as she enforces with her statement of Wir schaff en das or we can do it (Nanette, 2016). And as a result of this, Germany has allowed open borders throughout its country, allowing numerous amounts of refugees to enter and participate in the application for refugee status. This also fulfills moral duties to refugees as part of Germans culture of agreeable, which basically encompasses a part of the German identity of human morality with the wanting(p) to help, compared to other countries. Even so, as a result of the crisis, itis unknown what the future for the country that has tendencies toward bothxenophobia and welcome culture (Holmes, 2016). Furthermore, there are problems with negative connotationsand stigmatization that the refugees receive as current civilians are worriedthat the new refugees would take their jobs or that they are labelled asterrorists because of some recent events that have been occurring in Europewith attacks from migrants. There is also the problem of xenophobia as they arefearful and not super knowledgea ble or aware of negative stereotypes. And as aresult, there have been criticisms of Germanys refugee policy and thecreation of hostility from others to refugees. These issues that arise arerelated to serious applied morality and created discussions on limitations ofresponsibilities with questions of Where does my responsibility end?(Nanette, 2016).There have been more problems as Nanette adds Konrad Otts, a German philosopher, words of criticizing defenders of Merkels refugee policy and referring them to as deontologists, as he questions the pictorial sense of wanting to help refugees purely as an end to itself, which is an ethics of conviction, not having regard for possible consequences that could arise for others in the process. This raises questions about what is Germanys duty on how many refugees they should except and is that number within their threshold? This has been a large debate among many Germans as there is no clear definition of Germans responsibility, which has cau sed a lot of problems for the country. Continuing on with criticisms, retrieved from various German authors, some Germans are dismayed of the possibility of Muslims threatening German cultural identity (Nanette, 2016). As a result, this had feed into the further xenophobic ideas as wearing the burka has come to exemplify danger in the country, even though there are few women in the country that actually do wear them. In this circumstance, cultural change has not really been viewed in a positive context as enrichment, but always in a negative context as a threat.There are additional criticisms towards other things that allowing an influx of refugees to arrive provided, such as threats to safety and social peace which creates negative stigmatizations towards the refugees as some Germans are hostile and violent in regards to them because of their arrival (Nanette, 2016). Another problem relates to the costs of refugee programs and its consequences, it takes a lot of resources to a id refugees, as citizens that are poorer in terms of economic status could be negatively affected as there are increased taxes, a higher retirement age and reduced state benefits as Germany needs to accommodate more people. This raises the question of how much could Germanys own citizens be negatively affected in order to fulfill the moral duties of the countries and its individuals of helping those in need such as refugees. This further raises the issue of sense of moral obligation and capabilities.Voice from the GermanPublicA county in Germany named Passau hasbeen accept more refugees than whole countries in Eastern Europe(Feichtinger, 2016). And in this article titled Refugees in Germany by Hans Feichtinger, he details his opinion onthe refugee situation in his home country. He states that he is proud of thecharity and hospitability that he observes from Germans but because the numberof refugees has increased dramatically in the past year, there needs to be alimitation establishe d as there are many challenges that come with allowingrefugees to arrive, especially with such a large amount. Some examples ofchallenges that are mentioned are the difficulties of finding suitable livingquarters, accepting refugee children in schools and adds that the recentattacks in Europe, such as Hannover were from refugees that entered Europe. Hecontinues to voice his opinion and states that there are reasons why Germanyhas been so generous in allowing numerous amounts of refugees to enter thecountry, which are because it aligns with the philanthropy of Germans and thepremier and also provides economic benefits, as economic leaders have hold that the federal Republicneeds immigration to maintain its economic prosperity. And continues to addressthe issue by stating that it is slightlyunfair to accuse refugees of wanting to immigrate to this prosperity andsecurity as it depends on immigration in Germany. Even so, the refugee situation in Germany has been shown to become the u ltimate wedge issue of German politics as problems arise and become obvious (Dorstal, 2017). As mentioned previously, it is difficult to define some terms such as refugee and migrant as various interpretations can be made for each term. To obtain the refugee status, it was suggested that the persons need to be facing individual persecution relating to their race, religion, nationality or political beliefs. And those who do not fall under this category may have the opportunity to gain temporary protective status until the conflict ends. However, there are problems as the protective status is stated to not guarantee permanent residency in Germany. There are also expectations set in place for migrants that arrive in Germany as they should be able to integrate into Germany society and the economy that would benefit both sides. There continues to be a problem in Germany, as shown on social media and television, with defining the boundaries for the terms as they have been used without any clear distinction by politicians, which further adds to the confusion for German individuals as observers as some political figures cannot distinguish them properly either.ConclusionIn conclusion, it is important to note that there have been the recent resurface of refugee problems as there was recently a large increase of migrants as a result of conflicts such as the ones in Syria. This has caused a lot of problems as responsibilities are not evenly dispersed, with able countries not willing to help and partake in a share of the responsibilities. There are also implications with limitations of aiding refugees as there could be negative benefits that affect the host countrys current civilians in the process of helping the refugees. It is important to use statistical sources to help illustrate the large picture of the numerous amounts of refugees in the refugee crisis, easier to see in images. work CitedBAMF BundesamtFr Migration Und Flchtlinge A Culture of Welcome.BAMF Bundesamt FrMigration Und Flchtlinge selective information for Refugees in Several Languages Information Sheet on theAsylum Application, www.bamf.de/EN/Willkommen/Integrationsprojekte/Willkommenskultur/willkommenskultur-node.htmljsessionid=53FD018FDEB9DC20337BADA8EC30DA63.2_cid368.Dostal, Jrg Michael. The German Federal Election of 2017 How theWedge Issue of Refugees and Migration Took the sparkle off Chancellor Merkel andTransformed the Party System. Political Quarterly, vol. 88, no. 4, Oct.2017, pp. 589602. EBSCOhost, inside10.1111/1467-923X.12445.Europes Migration Crisis.HumanRights Watch, www.hrw.org/tag/europes-migration-crisis.Feichtinger,Hans. Refugees in Germany. First Things A Monthly diary of Religion andPublic Life spic-and-span York, no. 260, Feb. 2016, pp. 2022.Holmes circle M., and Castaeda Heide. Representing theEuropean Refugee Crisis in Germany and beyond Deservingness and Difference,Life and Death. American Ethnologist, vol. 43, no. 1, Jan. 2016, pp.1224. anthrosourc e.onlinelibrary.wiley.com (Atypon), doi10.1111/amet.12259.Marks, AmyK., et al. National Immigration Receiving Contexts A Critical reflection ofNative-Born, Immigrant, and Refugee Youth Well-Being. European Psychologist,vol. 23, no. 1, 2018, pp. 620. 2018-12389-002, EBSCOhost, doi10.1027/1016-9040/a000311.MigrantCrisis Migration to Europe Explained in Seven Charts.BBC News,BBC, 4 Mar. 2016, www.bbc.com/news/world-europe-34131911.Nanette Funk(2016) A tad in Germany refugees, a welcome culture and an integrationpolitics, ledger of Global Ethics, 123, 289-299, DOI10.1080/17449626.2016.1252785Navigation and Service.State& Society BirthsFederal Statistical Office (Destatis), www.destatis.de/EN/FactsFigures/_CrossSection/Refugees/Refugees.html.Refugee Crisis in Europe European cultivatedProtection and Humanitarian Aid Operations European Commission.SocialProtection Statistics Unemployment Benefits Statistics Explained,ec.europa.eu/echo/node/4115.UnitedNations. Solutions.UNHCR, www .unhcr.org/en-us/solutions.html.UnitedNations. The Relevance and Effectiveness of UNHCRs long-lived SolutionsActivities in Protracted Refugee Situations.UNHCR,www.unhcr.org/en-us/research/evalreports/5568170d9/relevance-effectiveness-unhcrs-durable-solutions-activities-protracted.html.UnitedNations. UNHCR Resettlement Handbook soil Chapter Germany.UNHCR,www.unhcr.org/en-us/protection/resettlement/5162b3bc9/unhcr-resettlement-handbook-country-chapter-germany.html.https//www.oecd.org/els/mig/Finding-their-Way-Germany.pdfhttp//www.refworld.org/pdfid/583714a44.pdfRefugeesin Germany Invasion or Invention? On JSTOR. http//www.jstor.org/stable/488464.Accessed 10 May 2018.Janning,Josef, (DE-576)164309039. Leading from the Centre ElektronischeRessource Germanys New Role in Europe / Josef Janning & Almut Mller.European Council on distant Relations, 2016.