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ACADEMIC MATTERS
Economics
In a year in which economics has dominated public conversation and headline space, every week has given our students material to discuss in lessons. Some of our Lower Sixth students have taken discussions one step further and written stories of particular interest.
COMPETITION IN THE GAMING INDUSTRY
This year has seen several acquisitions, worth more than $1bn, by major players across the industry. Whilst this may attract consumers to one brand, it also reduces the variety of games on offer across the market, restricting consumers to very few options. Acquisitions like this cause other firms to panic as the race to absorb competitors is already under way. Microsoft’s announcement alone led to a 10% fall in Sony’s share price. If there is no intervention, the industry may soon become monopolistic. Adam Comley
Sri Lanka’s foreign currency reserves, £5.8bn at the end of 2019, fell to £1.5bn in March 2020 and now stand at £40.5m. Huge debts racked up as the country aimed to fund infrastructure projects such as the development of Hambantota International Port. The loans Sri Lanka received from China had extremely short repayment periods, making repayment even harder. The shortage of foreign currency to buy imported necessities has caused shortages of food and fuel and skyrocketing prices. Inflation was estimated at 60% in June 2022. Jake Francis
SRI LANKAN DEBT CRISIS Microsoft has been trying to gain a larger market share in the games industry. Their focus has shifted to their subscription service, Game Pass, and they are currently expanding the collection of games available. In January 2022, they announced their intention to acquire Activision Blizzard, the world-leading publisher behind Call of Duty, for $75bn with the hope of strengthening their service. The deal is expected to be finalised around summer 2023 and would cement Microsoft’s position as the third largest video-game firm by revenue. There are several concerns surrounding such a large forward vertical acquisition. Microsoft could deny competitors access to Activision Blizzard’s games on their platforms. Millions of casual players who buy consoles for Call of Duty alone may need to switch platforms – a move that will significantly disrupt the market.
Sri Lanka has defaulted on its debts for the first time in their history as the country battles its worst financial crisis in over 70 years. It was unable to pay £63m in debt interest payments, causing credit rating agencies to refer to it as “defaulted”. Defaulting debts damages the economy as confidence in its currency plummets and it becomes harder to borrow from international markets. The government blames the pandemic and rising energy prices while critics say that this was a selfinflicted problem as the authorities failed to prevent severe inflation and ran out of foreign currency. After the Sri Lankan civil war ended in 2009, the government implored traders to provide goods to domestic markets instead of entering foreign markets. This reduced income from exports. Tourism, a major source of income, crumbled during the pandemic.
KINGSTONIAN 2021/22
WINDFALL TAX ON ENERGY COMPANIES
In his first budget, Gordon Brown used a windfall tax to fund his ‘New Deal’ welfare-to-work scheme. It may seem logical to ease the cost-of-living crisis through a similar method, yet the evidence suggests otherwise.
