Prediction Regarding the Future of the Global Economy

Published: 2019-10-07 15:30:41
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The global economy is highly dynamic, having several factors that all play a role in shaping and influencing it. Europe is faced with an immigrant crisis; the United States on its part is busy tightening its monetary policies through the Federal Reserve, the financial stability of China is unstable, and the state of emerging economies is highly fragile. All these factors all play a crucial role in predicting the future state of the global economy. Economists have stated that the state of the global economy could be doing even worse than it currently is. European and Japanese economies have their economies afloat thanks to low oil prices. South Africa, Turkey, Thailand, and Brazil; which comprise the emerging economies, are at high risk of collapse because of their high level of short-term crisis. Earlier predictions that the European Union will be grappling with rising nationalism and social unrest have come to pass as witnessed by growing pressure from some nationalists of the member states, notably Britain, to withdraw from the trading bloc (Harris and Patterson 2010). The United States, taking a leading role in fighting global terrorism is and will still be the major word economic power. It is however predicted that it will pull back and take a back seat in the global war on terrorism.

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Islamic militants will still be a major threat to the global economy. These militants will mostly concentrate their operations in the Middle East, spreading havoc across the globe. Their operations will, however, be largely contained through collective global effort aimed at combating the menace.

The European Union bloc, being one of the key players in the global economy, will have its unity disrupted. The diverse systems and demographics existent in the union will exert enormous strain on EU institutions. Moreover, citizens of member states will put increasing pressure on their leaders to withdraw from the bloc, dampening relations between the member states (Schenk 2011). The recent financial crisis that rocked the Union left it in a bad state which is difficult to recover from. As such, it has become weakened compared to its past glory.

Germany, though the fourth largest global economic powerhouse, will have its growth slackened due to the challenges facing the European Union. Its economy is strengthened by exports, the majority of which are destined to the European Union. Increased protectionist policies by member states due to influx of immigrants will gradually make it difficult to export, weakening the countrys economy.

Increased debt by third world and emerging economies will be felt not only in these economies but the global economy at large. As pressure mounted on these countries to settle their debts, they resolved to environmental degradation to source some funds to pay off the debts as their financial status was thinning. Environmental degradation is not a problem which only concerns the countries under consideration; its effects are felt all over the globe in the form of global warming. In a bid to clear their foreign debts, third world countries resort to exporting more while cutting back on imports (Harris and Patterson 2010). In so doing, economic powerhouses will also be affected as they will have no avenue to sell their produce.

The capitalistic system, if unchecked, will eventually come in conflict with the environment. Economies are striving to amass wealth in a shrinking environment in terms of resources and space. To increase their wealth basket, they have resorted to the environmental invasion to pave the way for the establishment of industries, in the process reducing the forest cover. This, in turn, triggers a chain of events that ultimately lead to devastating effects of global warming.

References

Frieden, Jeffry A and David A Lake. 1999. International Political Economy. New York: Routledge.

Harris, Jerry and Rubin Patterson. 2010. The Global Struggle For Human Rights. Leiden: Brill.

Schenk, Catherine R. 2011. International Economic Relations Since 1945. Abingdon, Oxon: Routledge.

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