UN: global growth fell sharply last year and continue to decline through 2012
The report received by the agency / Baghdadiya News / “The global growth fell sharply last year and continue to decline through 2012 as decline in global growth from 4.1 per cent in 2010 to 2.7 per cent in 2011, is expected to continue to decline in 2012 to less than 2.5 per cent, according to the Trade and Development Report for 2012 released Wednesday by the United Nations Conference on Trade and Development (UNCTAD).
He noted that “the report entitled” Policies comprehensive and balanced growth, “focuses mainly on income inequality, and suggests that reducing the widening gaps in wealth and income will not be his only social benefits, but will also lead to greater economic growth.
Shows the Trade and Development Report 2012 to “many developing countries support the demand and growth of local economic policies to be counter-cyclical., But stresses that he is not able to those countries avoid slow economic at the same time when these countries to be affected by the continued deterioration in the advanced economies.”
It is expected that the economic expansion in the economies of developing countries and countries in transition stronger in 2012 – by 5 per cent in the first group countries and 4 per cent in the second group countries – but it will be less than has been achieved in previous years. The developing world has become, thanks to progress in a number of major economies, less dependent than ever before on the developed economies, and has also become more domestic demand ability to adapt. The report indicates that about 74 per cent of world output growth witnessed in the period between 2006 and 2012 has been achieved in developing countries, compared to only 22 per cent in developed countries. On the contrary, it was developed in the eighties and nineties, accounting for 75 per cent of global growth, a percentage that dropped to just over 50 per cent between 2000 and 2006.
According to the report, developing countries are still vulnerable to weak demand for exports from the developed economies, it is likely that the situation remains unchanged with austerity programs continue, especially with the severity of their impact in Europe. This trend is reflected in the stagnant volumes of exports to the markets of developed countries, and in the direction of commodity prices downward since the second quarter of 2011. Moreover, the report confirms that the financial instability witnessed in developed countries affect the financial flows toward emerging market economies and increases the inherent volatility of commodity prices.
The new UNCTAD report notes that widening gaps in the distribution of income and wealth in different parts of the world is not an inevitable byproduct of the consequences of globalization and technological change. And confirms that the increasing concentration of income in the hands of a few restricts the possibilities of countries in the economic field weakening demand for goods and services and reduce the prospects for education and social mobility available to the population more generally – do not take advantage of their talents and their economic achievements possible underused. And can reverse these trends, but should do so, through the intervention of the government policies and financial policies for the labor market, as reflected in the report.
And show trends over the last thirty years the increasing income inequality within and among countries. The share fell wages in total income in most developed countries and many developing countries. The report considers that belief since the eighties that the governments in their quest to increase economic efficiency, condone poor income distribution, is a misconception – and recommends steps that can be taken to reduce disparities in income and promote economic growth at the same time. The policy also states that that keeps the workers’ share in the national income and redistribute income through progressive taxation and public spending will improve equality as well as economic efficiency and growth.
And indicates the Trade and Development Report 2012 also noted that the model of labor market flexibility has not only failed to reduce unemployment, but often leads to worse. Fbalaatmad pressure and wage cuts as a key tool for increasing employment opportunities, overlooked “labor market reforms” the importance of the contribution of income distribution in demand growth and job creation. The report adds that when the overall productivity grow without a corresponding increase in wages, will reduce demand in the end for energy productivity, reduces the rate of utilization of productive capacity and reduces profits and investments.
Commenting on the new report, stressed Abdullah Dardari, chief economist and director of economic development and globalization in the ESCWA, that policies contraction in advanced economies did not give results not only for control budget deficits in these countries, and for encouraging its growth in the rest of the world. Vankmac demand in developed countries, the depth of the problem of unemployment and weaker global demand for exports in the developed and developing countries, which contributed to the deepening of the global crisis and economic recovery at risk. Dardari said “here must not only structural reforms, but it must be fiscal and monetary policies for growth and permanent operating reinforcing export demand across the world.”
As Dardari pointed out that restore the balance between income levels within each country and at the global level is one of the most important sources of growth potential in the global economy means that social justice is no longer a target just about fairness, it is prudent economic policy are the way out of the global crisis. To achieve this, the countries must reform their taxation policies to be able to finance social spending and increase productivity and incomes, lead to increased export demand and therefore, employment and growth. He added that these points emphasize advocated by the ESCWA of the need to adopt an approach new economic and social in the Arab countries based on the overall growth of all on economic efficiency and social justice and economic diversity under the roof of state developmental sponsor of the goals of society represents truly representative in governance framework democracy. “
The expert regional employment policies and macroeconomic Regional Office for the Arab States of the ILO Zaferis Tzanatos has said he is likely to result in the deterioration of the economic outlook to the high rates of unemployment, loss of income for most people – even for those people who live at or below the poverty line , and growing inequality, especially in terms of the concentration of wealth. An analysis by UNCTAD and the International Labour Organization (ILO) that the communities most comprehensive and equitable to have higher rates of economic growth is also more sustainable. Empowers communities fair people use the full capabilities by improving their educational opportunities and encourage talent, and the application of fair taxes, and support social mobility and provide credit to people and according to Tzanatos “.
He Tzanatos “must reduce the growing escalation of government debt, but it is better to be achieved through the restoration of growth (and fiscal revenues) rather than trying to raise taxes in an economy rickety. Could contribute to reforms in the recovery when it is not based on the idea that” good country is a small country, “but the expansion of the economic role in support of the state while the state create or strengthen social services and addressing the inequalities unjust.”
For its part, considered Canada the Muhammadiyah, director of programs at the network Arab non-governmental organizations for development, the report stresses the central role to reduce the inequality in income as a key factor to achieve sustainable development and economic growth, as well as the development of local markets. For her, the report focuses on the importance of reviewing the foundations of national economic policies and the role of productive capacities and redistributive policies, including the role of fair income and progressive tax policies and existing policies to boost domestic demand. “
And Muhammadiyah concluded by saying that these recommendations are of great importance for the Arab States experiencing changes in political leadership and democratic transition process requires a broad policy-making and re-political. This has contributed to development in the Arab world to deepen inequalities and, therefore, should be treated as part of the re-development of the economic policies of these countries. But it is surprising how we continue to see the recommendations of the financial institutions calls for Arab countries to strengthen the protection of wage flexibility and functions as a means to renew economies.