Last week, two highly publicized events occurred in the United States that could shake the foundations of the limping economy. The first one, the passage of the Arizona immigration bill, has already led to boycotts and broken agreements. The second, an oil spill of epic proportions in the Gulf of Mexico by the huge British Petroleum oil corporation, is becoming one of the worst man made environmental disasters of all time.

We will skip all the political and environmental ramifications and concentrate on the effects on the economy.

I. The Effects of the Immigration Law on the Economy are Exaggerated.

Most people know that there have already been attempts to start boycotts against Arizona because of the passage of the immigration law. Furthermore, the Mexican government and many NGO’s have told travelers to stay away from Arizona – a state that attracts 15 million tourists a year. Also, people have begun boycotting Arizona Diamondback (a baseball team) games because one of the board members of the team supports the law, which I think is foolish, because the entire team is placed in limbo because of the individual actions of one man.

However, the two most significant actions that have yet to be realized are a possible breakup of business contracts by the city of Los Angeles (which does over $10 million in business with Arizona a year) and a similar action by California. I feel like the media has emphasized this a lot because it can really leave a crater in Arizona – which is home to one of the highest percentage of foreclosed homes in the nation.

Now, I feel like the threats from Los Angeles/ California will never be realized for one simple reason. LA’s budget deficit is very high and its already becoming hard for the city to accept loans due to its bad credit rating. The same story holds for California, which can’t afford to lose business to anyone. Will a Republican governor ever endorse a bill that means losses for businesses and contractors? Never.

There might be some pockets of boycotting against Arizona, but its going to be very hard (and probably unconstitutional) to end state contracts due a legal clause. It will get even harder if the Supreme Court upholds the legality of the law in the coming months. Will this be enough to affect Arizona? Maybe… but only because anything can effect Arizona at the moment.

II. How about the Oil Spill off the Gulf of Mexico in previously pristine waters?

The British Petroleum Oil Spill is a nightmare for everyone and could lead to a huge uproar against both the private and federal emergency efforts. As of today, the spill has a land area the size of Puerto Rico, in an area of the country where the fishing industry dominates the economy.

In the short term, crude oil prices have been hovering at a recent high of $86 per barrel because of investor fear of the ramifications that BP will have to face in the coming months as the publicized disaster chips away at the hearts of conservationists and environmentalists.

In the long term, the fishing industry is going to take a long time to recover. It might be a year or two before all the oil is cleared away and the fish begun to return to damaged areas. Fisherman, who pay a lot of taxes in the Gulf Coastal area, are going to be jobless and will stop being productive consumers and taxpayers until they can find new jobs or return to fishing. All in all, the carelessness of a giant company is not only going to hurt the marine ecology, but the economy of the country it relies on for off shore drilling.

Hopefully, the beauty of the coastal regions and wetlands can be restored.

SmarterSpend has compiled a list of top ten ‘traditionally less known’ countries where investments can prove highly beneficial- whether it is a business or a real estate purchase. These countries are in no particular order.

Scroll through and let us know what you think.

1. Belarus

SmarterSpend Investment Rating: 8.0 / 10

Belarus Buildings

2008- 2009 GDP Growth Rate: 10.0 %

GDP: $118 billion

Population: 9.6 million

Human Development Level (HDI): 0.817

Government: Presidential Republic

Exports: machinery and equipment, mineral products, chemicals, metals; textiles, foodstuffs

Imports: mineral products, machinery and equipment, chemicals, foodstuffs, metals

Natural Resources: Forests, peat deposits, small quantities of oil and natural gas, granite, dolomitic limestone, marl, chalk, sand, gravel, clay

2. Brazil

SmarterSpend Investment Rating: 10.0 / 10

(+ for diverse economy, stable government, low threat of war/civil unrest, GDP growth, vast untapped natural resources, labor force, upcoming World Cup and Summer Olympics)

Aircraft Industry In Brazil

The Tidbits:

Brazil’s economy is the tenth largest in the world, but with a constant increase and a large population, it will be a focus of international investments in the future. Brazil has a strong agricultural sector fueled by coffee and soybean exports, oil reserves, industrial capability (VALE is a huge mining company), and petrochemicals. The trade balance is positive and there is no reliance on a single trading partner. The 2014 World Cup and the 2016 Summer Olympics, arguably the most international events in the world will be held in Brazil.

Look for Brazil to be in the news in the recent future as investors flock there.

2008- 2009 GDP Growth Rate: 5.1 %

GDP: $1.6 trillion

Population: 192 million

Human Development Level (HDI): 0 .813

Government: Presidential Federal Republic

Exports: transport equipment, iron ore, soybeans, footwear, coffee, autos, automotive parts, machinery

Imports: machinery, electrical and transport equipment, chemical products, oil, automotive parts, electronics

Natural Resources: Forests, peat deposits, small quantities of oil and natural gas, granite, dolomitic limestone, marl, chalk, sand, gravel, clay

3. Slovakia

SmarterSpend Investment Rating: 8.5 / 10

(+ for diverse economy, stable government, low threat of war/civil unrest, GDP growth. – for landlocked, – for negative growth rate)

Bratislava Financial District

The Tidbits:

Slovakia is a post-communist country in Central Europe and a member of EU, EuroZone, and NATO. Its economy is marked with the lowest income disparity in the world and foreign investment oriented laws. 1.6 million tourists visited Slovakia in 2006 as it features a beautiful natural landscape and rich cultural heritage marked. The southern part of Slovakia (bordering with Hungary) is known for its rich farmland. Growing wheat, rye, corn, potatoes, sugar beets, grains, fruits and sunflowers. Vineyards are concentrated in Little Carpathians, Tokaj, and other southern regions. The breeding of livestock, including pigs, cattle, sheep, and poultry is also important.

2008- 2009 GDP Growth Rate: 6.1 %

GDP: $119 billion

Population: 5.3 million

Human Development Level (HDI): 0.88

Government: Parliamentary Republic

Exports: Automobiles (16%), iron and steel (9.5%), and refined petroleum products (6.5%) apparel (4.3%), motor vehicle parts and accessories (3.6%)

Imports: consumer goods, 12.3%; food, 4.5%; fuels, 17.6%; industrial supplies, 30.6%; machinery, 19.9%; transportation, 15.0%; and other imports, 0.1%.

Natural Resources: Brown coal and lignite; small amounts of iron ore, copper and manganese ore; salt; arable land

4. Argentina

SmarterSpend Investment Rating: 9.0 / 10

(+ for diverse economy, stable government, low threat of war/civil unrest, GDP growth, high literacy rate, – for wide income disparity)

Buenos Aires Skyline

The Tidbits:

Argentina may be the most European influenced country in the Western Hemipshere, with 93% of the population coming from European ancestry. Argentina has a very high literacy rate and was considered one of the richest countries in the world in the start of the 20th century. Foreign nationals hold $76 billion worth of investments in Argentina and the country is open to moderate amounts of migration. Also, the country has rich mineral deposits and arable farmland.

2008- 2009 GDP Growth Rate: 6.97 %

GDP: $578 billion

Population: 40 million

Human Development Level (HDI): 0.86

Government: Federal Presidential Republic

Exports: Soybeans and byproducts, 23.4%; cereals (mostly maize and wheat), 9.7%; motor vehicles and parts, 9.3%; refined fuels, 6.5%; chemicals, 6.2%; aluminum and steel, 4.9%; natural gas and petroleum, 4.4%; other industrial products, 11.1%; all other (mostly processed agricultural products), 24.5%.

Imports: Industrial and computing machinery and parts, 39.4%; industrial supplies, 35.2%; automobiles and other consumer durables, 12.8%; refined fuels and lubricants, 7.5%; all other (mostly consumer non-durables), 5.1%

Natural Resources: Fertile plains of the pampas, lead, zinc, tin, copper, iron ore, manganese, petroleum, uranium

5. Panama

SmarterSpend Investment Rating: 8.0 / 10

(+ for diverse economy, stable government, GDP growth, – reliance on few trading partners, large trade deficit)

Panama City

The Tidbits:

Panama, an American invention, is a fully dollar based market economy with an emphasis on the banking and tourism sectors. Its near future economy will be bolstered by tolls from the Panama Canal rebuilding project, which will allow for twice the number of ships to pass. Unemployment is minimal and the country exports heavily to the United States.

2008- 2009 GDP Growth Rate: 9.21 %

GDP: $42 billion

Population: 3.3 million

Human Development Level (HDI): 0.840

Government: Constitutional Democracy

Exports: $10.29 billion: bananas, shrimp, sugar, coffee, and clothing

Imports: $15 billion: capital goods, foodstuffs, chemicals, consumer and intermediate goods

Natural Resources: Copper, Mahogany Forests, Shrimp, Hydropower

6. Romania

SmarterSpend Investment Rating: 8.5 / 10

(+ for diverse economy, stable government, GDP growth, trade surplus, numerous trading partners, rich in natural resources – irregular government planning)

Bucharest Chamber of Commerce

The Tidbits:

Romania is a EU member that has recently shown high growth rates and development, and the 11th largest economy in Europe. The country has high per capita incomes and a growing middle class. It has declining oil reserves but enough mineral output to supply its industry. The country is planning on extending its highway system and has a strategic location in SE Europe, where it is an important stop for commerce. Also, a tertiary economy is present with 51% of the GDP coming from the service sector.

2008- 2009 GDP Growth Rate: 9.37 %

GDP: $270 billion

Population: 22 million

Human Development Level (HDI): 0.837

Government: Unitary Semi-Presidential Republic

Exports: agricultural products, chemicals, footwear, fuels, machinery, metal products and textiles

Imports: machinery and equipment, fuels and minerals, chemicals, textile and products, metals, agricultural products

Natural Resources: Petroleum (reserves declining), timber, natural gas, coal, iron ore, salt, arable land,
hydropower

7. Dominican Republic

SmarterSpend Investment Rating: 8.5 / 10

(+ for free trade zone earnings, stable government, GDP growth, availability of labor, rich in natural resources

- resource mismanagement, reliance on remittances, energy shortage )

The Tidbits:

The Dominican Republic is the second largest economy in the Caribbean and Central America. It is now the largest tourist destination in that area and mostly serviced based, although sugar cane and ferronickel production are one of the major sources of revenue for the country. Underdeveloped energy and fishing sectors are the prime areas for future investment, along with a booming tourism sector. DR trades heavily with the United States, although it has been diversifying in recent years with Japan, Venezuela, and Mexico.

2008- 2009 GDP Growth Rate: 9.37 %

GDP: 10.7% (2006), 9.1% (2007)

Population: 10.1 million

Human Development Level (HDI): 0.777

Government: Democratic Republic

Exports: ferronickel, sugar, gold, silver, coffee, cocoa, tobacco, meats, consumer goods

Imports: foodstuffs, petroleum, cotton and fabrics, chemicals and pharmaceuticals

Natural Resources: nickel, bauxite, gold, silver, fisheries

After the First Great War, there was no real power as Europe tried to recover from the devastating damage to infrastructure, the loss of a generation, and a Spanish flu virus which killed more people than the war itself. The United States began its dominance at sea, but surely, we weren’t the only power. During the 1920s- 1940s, the world suffered a global depression that was many times worse than today’s economic collapse and clearly and no country could be classified as a “superpower.”

World War II left the United States and the Soviet Union as clear global powerhouses. During the 1960s, the American society enjoyed affluence due to noncompetitive outside markets and prospered like no other group of people ever had. The Soviet Union benefited from a broken down Europe and increased its influence all the way to East Germany until its collapse in the early 1990s.

After the dissolution of USSR, the United States was the only superpower in the world, both economically and militarily for the first time in its history. The Dot Com boom generated jobs and for a few years the United States had a budget surplus, the lowest poverty rates in its history, and the most years of consecutive sustained growth. Living in the 1990s it would be hard to imagine an America so.. ill.

With that said, it is possible to predict the influence of countries in the near future based on recent economic performance and potential for future growth. Countries are ranked in order of current GDP and given a score out of 10 based on certain criterion. All numbers are based on December 2008 figuresn. It is important to note that pre-recession numbers are accounted for in the growth rate because its likely that when the recession does end, similar growth patterns will be seen. Finally, red items are causes for concern and green items are the definite advantages.

1) The United States of America
Gross Domestic Product (GDP): $14.58 trillion
Real Growth Rate:  1.4% (2007-2008)
National Debt: $12.25 trillion
Population Growth: 0.883%
Other: America is still the most influential country in the world, with a diversified economy and very high per capita GDP. After the recession, American’s will spend less money and waste less, reducing public debt and forcing economic realignment. A quick end to the war(s) in Iraq and Afghanistan will provide more money for domestic purposes. The US is still the leading power as the global economic crisis affected every country.
Superpower Potential: 8.5

2) Japan
Gross Domestic Product (GDP): $4.48 trillion
Real Growth Rate:  0.7% (2007-2008)
National Debt: $1.492 trillion
Population Growth: -0.139%
Other: Japan economy plunged 3.3% last quarter and the GDP will slip at about 10% annually. Leading exporters are cutting jobs on a grand scale and the most successful companies are posting losses in the billions. Also, Japanese consumers are cutting back faster than American counterparts. Couple this with a negative population growth and an upside down population pyramid (more older people than young), Japan will see heavy declines in the upcoming decades.
Superpower Potential: 2.5

3) China
Gross Domestic Product (GDP): $4.22 trillion
Real Growth Rate: 9.8% (2007-2008)
National Debt: $420.8 billion
Population Growth: 0.629%
Other: A labor force over a billion people,  a rapidly growing economy, and vast land resources will allow China to prosper and influence the world in many ways. In understanding the Chinese rise to superpower status, one has to understand its main source of income, exports. If exports drop, China drops. In fact, due to recent decreases in demands, over 10 million Chinese were laid off last year. When China begins to be more diversified, then the world has reason to fear.
Superpower Potential: 7.0

4) Germany
Gross Domestic Product (GDP): $3.8 trillion
Real Growth Rate: 1.7% (2007-2008)
National Debt: $4.5 trillion
Population Growth: -0.044%
Other: Germany’s overwhelming national debt will stand as a problem in ever gaining leverage against other countries. Also, Germans have a very large public debt, similar to the United States. However, Germany had diverse exports and was second only to China in 2009 in total export value.
Superpower Potential: 4.0

5) Brazil
Gross Domestic Product (GDP): $1.665 trillion
Real Growth Rate: 5.2% (2007-2008)
National Debt: $236 billion
Population Growth: 1.3%
Other: Many people talk about China and India as superpower hopefuls in the 21st century, yet there is not much talk of Brazil. Oil, soy, and coffee exports have allowed Brazil to enjoy a quarter century of spectacular growth after the lost decade in the 70s. Brazil has vast mineral resources and has several huge international corporations (Petrobras, Vale, etc). The only negatives are a smaller population (althought growing fast) and less military power.
Superpower Potential: 5.5

6) Russia
Gross Domestic Product (GDP): $2.25 trillion
Real Growth Rate: 6.0% (2007-2008)
National Debt: $571 billion
Population Growth: -0.478%
Other: With tens straight years of growth at 7% annually since 1998 and a progress minded people hoping for the pre-Soviet collapse stability allowed Russia to jump into the world scene. The war in Georgia showed the West that Russia wants its respect back. Russia has oil and energy and provides up to 40% of the natural gas to Europe. Russia (largest land area) also has nuclear weapons, a powerful arsenal of advanced weapons, and untapped mineral resources in Siberia.
Superpower Potential: 7.0