If we try to find one word that properly fits the current day economic scenario all across the world, then ‘Economic Turmoil’ will be the right world! As per latest statistics from International Monetary Fund (IMF), world is definitely headed towards deep recession. World growth rate is expected to be 2.2 percent this year and that is much lower than standard benchmark of 3 percent.
No country could save itself from onslaught of economic crisis. What started with USA, gradually spread to all across the world. Economic powerhouses including Euro Zone and Japan etc are facing severe crunch of resources.
Most of the Asian countries were considered immune from this ongoing crisis. But much hyped decoupling theory which told about emerging nations having differentiated themselves from first world countries in terms of economic growth and prosperity, proved to be of no use.
Decoupling theory of which India was also considered as a part also emphasized upon developing economies getting them insulated from developments in US economy. But as can be seen from economic indices and lower GDP growth prediction all across the globe, world is deep into crisis mode.
Governments of USA, England, Japan, France etc have announced bail-out packages for severely affected industries including textiles, automobiles, banks, financial institutions etc. But, nothing could prevent these economies from facing liquidity crunch and rising unemployment ratio. Exporters
and stock broking
firms have been hit badly. The fear of deflation is also
looming large what with falling interest rates and lowering
inflation further reducing the demand for
commodity
trading.
Crude prices have fallen significantly which also signifies low margins for refinery and less amount of international trade. There are even predictions of recovery only by the end of late 2010. Indications are rife that 2009 is going to be very difficult in terms of economy and unemployment.
Falling industrial output is expected to worsen the economic crisis. All in all, several efforts are being taken by governments but the economic crisis is likely to remain widespread in coming times.