Current Responsibilities in Face of Global Economic Challenges
- 23 February 2016
It seems that the global economy will remain under the mercy of pressure and setbacks in 2016. The outcome of this performance will not be different than that of 2015. The sluggish growth which marked its performance last year will remain a key feature of this year’s performance, especially amid a growth slowdown in emerging economies, especially the Chinese economy which is lacking internal growth incentives for multiple reasons, chief among which the difficulties faced by the Chinese government.
As for developed countries, vulnerability continues to take its toll on the economy amid fears of adverse repercussion in the performance of the US economy. In addition to the uncertainties surrounding the Eurozone’s economy coupled with fears of the Brexit and its potential repercussions on the EU and the global economy
At the same time, indicators from global oil and energy markets as well as commodity and raw material markets in general indicate that the future outlook for 2016 will be marked by plummeting demand that will not be able to absorb the increasing offer. This tendency is currently exhibited in oil markets. The demand/offer gap can only be understood through analyzing the reasons for the decrease of the demand on oil. It is also evident that the exaggerated increase in oil production in some countries contributes to the pressure suffered by oil markets. The decrease in demand also contributes to the low levels of economic growth in the global economy and adds to its frailty.
It is true that the global economy has witnessed a relative recovery over the past years, and a gradual exodusof the repercussions of the “global financial crisis” , which hurt it much in 2008 and 2009, but the data and indicators issued by official authorities and specializedinstitutions in a number of major economy countries, in the US, China, Japan and Germany, and others, as well as indexesissued by international economic institutions, especially the “international Monetary Fund”, all warning that 2016 year will not be more than a continuation of the same tracks followed by the global economy over the past year.
It is true that the global economy could experience a relative gradual recovery from the repercussions and detrimental effects of the global financial crisis in 2008-2009. Yet, data and indicators issued by official institutions in several international economic powerhouses, such as the US, China, Japan and Germany, in addition to the indicators established by the International Monetary Fund warn that 2016 will not bring big change in terms of economic performance compared to last year.