Projects Info |
   
Advertise Here [728 W x 90 H pixels]
First Person | October 2011

In the euro zone, the indications are that drastic austerity measures might entail a recession....

 "In the euro zone, the indications are that drastic austerity measures might entail a recession without resolving their debt sustainability problem" - Pranab Mukherjee, Finance Minister.

"We are meeting here at the time when global economic growth seems to be losing its momentum after about a year and half of fragile and uneven recovery.  There are signs of economic and financial weaknesses in Europe and the US that threaten the global economic outlook.  It is important that at this juncture the BRICS countries have come together to discuss the implications and the possible policy responses to the emerging situation in the US and Europe and in doing so make an assessment.

Global economic growth seems to be decelerating recently with a downward revision in growth projections of both advanced and Emerging Market economies after about a year and half of fragile, uneven and multi--paced recovery.  The weaknesses in major developed economies continue to be a drag on global recovery and poses risks for world economic stability.  Despite the return to growth, unemployment levels in the United States remains at unacceptably elevated levels.  With the near term growth prospects in both the US as well as in the European countries appears to be rather bleak, and according to experts, the chances of a double dip recession cannot be ruled out.  In the euro zone, the indications are that drastic austerity measures might entail a recession without resolving their debt sustainability problem, and possibly also affect the growth prospects of other neighboring European economies.  There is also a fear that Euro zone sovereign debt crisis could spread to some larger countries that are too big to be bailed out.  As I had said previously, the most serious problem faced on an immediate basis is the market perception that public debt of developed countries will continue to rise even as growth remains subdued. The downgrading of US sovereign long-term debt by Standard and Poor`s, is nevertheless a clear indication of a lack of conviction about policy action.  The fall in several global forward looking indices also reflects in some ways a similar sentiment."
   

Post your comment
Name:  
Email:    
Comments:  
Verification Code:   Change Image


 
Advertise Here [728 W x 90 H pixels]