Has the crisis affected remittances from migrants abroad? One survey has found that migrants from Latin America based in the US are still sending money home even if that means cutting expenses, taking second jobs, working more hours or, if they have lost their jobs, dipping into their savings.
International mergers and acquisitions have registered a decline of 56% in 2009 over 2008, latest estimates show. This is the largest year-on-year decline in recent history. Much of this decline was due to the 60% plunge in M&A activity by firms based in the OECD area, from over $1 trillion to $454 billion. But major emerging economies, which enjoyed strong international investment performance in 2008, also suffered their first sharp declines in 2009 with respect to both outward and inward M&As.
Ireland was the fastest growing OECD economy since the mid-1990s. It is now experiencing one of its most severe recessions. What explains this turnaround? How will the Irish economy recover?
The recovery that began earlier this year in a number of non-OECD economies has now spread to the OECD area at large. But in most OECD economies, growth is likely to fluctuate around a modest underlying rate for some time to come. It is being held back by still substantial headwinds as households, financial institutions, non-financial enterprises and, eventually, governments have to repair their balance sheets. This also means that unemployment is set to move higher and already-low inflation will be under further downward pressure. It is only some time down the line that the recovery will become sufficiently strong to begin to reduce unemployment.
Governments in Asian countries have been responding to the global crisis with stronger social policies. The economy should benefit.
More active education and employment policies, particularly targeted at minority groups, are needed to bolster its economic performance and bridge deep divisions within its society.
European businesses were disappointed with the climate change agreement hammered out in Copenhagen. Here’s one way forward.
As the financial storm recedes the full cost of the damage is being assessed. According to Financial Market Trends, from the start of the crisis to October 2009 governments and central banks in the US and Europe had provided over $11 trillion in support to banks and other financial firms, made up of capital injections, asset purchases, debt guarantees and facilities, and so on. This total does not take account of other wider social and economic costs incurred by way of losses in business, jobs and other fallout from the crisis. Still, as a Dow Jones journalist pointed out in seeing the figures, it amounts to a contribution of over $1,600 for every person on the planet. The question is: are policymakers doing enough to tackle the root of the problem and prevent the worst crisis in 50 years from happening again?
International trade fell off the charts in the fourth quarter of 2008 and showed only a modest easing in the rate of decline in the early months of 2009. Well-regulated open trade is essential for economic recovery and development, yet in times of crisis, protectionism may appear an attractive solution. It should be resisted.
The world economy has hit a wall over the past 12-18 months. This was the opening message from INSEAD's Soumitra Dutta in a panel debate at OECD Forum 2009 to discuss the OECD's latest economic forecasts launched moments earlier (OECD Economic Outlook No 85, June 2009).*
Environmentally-friendly investments form part of many recently launched recovery programmes. With the right policies, they could achieve growth and a cleaner planet as well.
In 1962, we usually divided the world into three regions. The advanced capitalist group was then known as the developed world. The second was the “Sino-Soviet bloc”. Countries “in course of development” were the third world. The China-USSR split occurred in the early 1960s; most of the communist regimes collapsed around 1990, and the hostility of the cold war has largely faded away. The income gap between the former communist countries and the advanced capitalist group has become very much wider than it was. For this reason, a tripartite division of the world economy is no longer appropriate.
