Economic Development
ECONOMIC DEVELOMENT
we focus on Providing a way of thinking about a globalized economy and its relationship to security.
The world economy experienced subdued growth for a second year in 2013, but some improvements have led to more positive forecast. The Euro area has finally ended a protracted recession. Growth in the United States strengthened somewhat. A few large emerging economies, including China and India, managed to backstop the deceleration they experienced in the past two years and veered upwards moderately. These factors point to increasing global growth. But there are risks and uncertainties threaten global economy.
The risks associated with a possible bumpy exit from the quantitative easing programmes by the U.S Federal Reserve (Fed) threaten the global economy. As already seen somewhat during the summer of 2013, efforts by the Fed to pull out of quantitative easing programmes could lead to a surge in longterm interest rates in developed and developing countries. As the Fed is expected to taper and eventually unwind its quantitative easing programmes, emerging economies will face more external shocks. While economic fundamentals and the policy space in many emerging economies are better than when the Asian financial crisis erupted in 1997, emerging economies with large external imbalances remain particularly vulnerable.
Other uncertainties and risks include the remaining fragility in the banking system and the real economy in the Euro area and the continued political wrangling in the U.S. on the debt ceiling and the budget. Inflation will remain serious worldwide and the employment situation will continue to be challenging. Beyond the economic domain, geopolitical tensions in Western Asia and elsewhere remain serious risks.
With multiple and complex challenges facing the world economy, GOT calls for strengthening international policy coordination to advance the global economic integration,.
