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AS I SEE THINGS: Maintaining progress amid turmoil


Brian Francis

AS I SEE THINGS: Maintaining progress amid turmoil

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Isn’t it rather interesting that in addressing the prospects for the global economy as of June 2011, the World Bank finds it necessary to define the complexity of the situation facing the world economy as “maintaining progress amid turmoil?”
Clearly, taken literally, what this suggests is that in the opinion of the World Bank there is some light at the end of the tunnel for the global economy, but there are significant challenges to be overcome just to be able to sustain the recent progress made in the aftermath of the 2007 to 2008 global financial and economic meltdown that affected countries large and small, rich and poor, and even capitalistic or socialistic in economic orientation.
Therefore,despite the level of difficulty yet to overcome, countries all across the globe – including those in the Caribbean – continue to enjoy the luxury of knowing that at the minimum they can still grow and develop by confronting head-on the current threats to their economies while putting structures in place to fully exploit available opportunities for success.  
And the good news for us in the Caribbean is that size does not matter in this regard.  Innovation and dexterity in the formulation and implementation of economic policies, plans and programmes will win the day.
But why has the World Bank chosen such a contentious theme within which to cast its judgment about the current and future states of world economies? The answer to this question can be found quite easily in the overview and main messages section of the report.
According to the World Bank, “Macroeconomic policy in developing countries needs to turn toward medium-term productivity enhancements, managing inflationary pressures, re-establishing the fiscal and monetary cushions that allowed most developing countries to come through the crisis so well. In contrast, activity in high-income and some developing European countries continues to struggle with crisis-related problems, including banking-sector, fiscal and household restructuring.” What a mouthful!
In short, this characterization of the current state of affairs of the global economy by the World Bank amounts to a simple conclusion: while developing countries have managed to ride the wave of destruction created by the recent global financial and economic recession, many high-income countries and developing European economies are still suffering from the same aftershocks, creating for developing countries a situation that demands “maintaining progress amid turmoil”, as the World Bank so eloquently puts it.   
The truth is that this is an extremely unfortunate and tough position developing countries have now to confront head-on.
In a perfect world, this scenario could have been ignored. But in a world that is increasingly forced to accept the growing influence of globalization, developing countries have little choice but to plan for the worst and expect the best.  
Since external forces will always play a meaningful role in the current and future performances of developing countries, they will best be served by accepting that as reality and responding each time to all of the associated nuances that follow.
Any response short of this approach will be financially and economically chaotic – a price too severe to pay for our inadequacies in responding to global forces not as they are but as we would want them to be!

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