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Global economic turmoil shouldn’t be taken lightly

28 Mar 2023 00:00:00 | Update: 27 Mar 2023 23:04:49
Global economic turmoil shouldn’t be taken lightly

The world economy has been in turmoil for quite a long time. Over the past six months, the situation has headed towards no remedy rather it has plunged into more economic chaos. Almost all major economies are facing the threat of a more severe economic crisis in the days to come. Some global economists are predicting a recession that will shake the world economy while others are not in agreement with them. They are hoping this economic tsunami is going to pass over within a short period.

The scenarios don’t seem to be like that. Now it can be said for sure that the world is not passing through a rosy time. The shadows of recession is almost everywhere. The economic crisis is leading the world to a political crisis. The discussion between Saudi Arabia, the major ally of the USA in the Middle East, and Syria is on. They are trying to restore ties between them. The discussion is being brokered by Russia.

France too is in a deep crisis with people being infuriated over pension reforms. People’s fury led police to open fire on them. On March 25 protesters turned violent on the ninth day of the protest. Thousands of people are coming onto the streets to join the protest. The tech world is also in crisis with tens of thousands of jobs being lost. At least two million tech workers have been fired this season. Tech CEOs are now apologizing for so many recruitments during the pandemic. Now that the pandemic is over they don’t need so many workers.

North Korea has tested a new weapon, a nuclear underwater drone capable of causing a radioactive tsunami. After the collapses of several USA banks now Deutsche Bank shares nosedived by over 13 per cent putting the European banks’ ability into question. The collapses of those banks caused turmoil in the global financial stock. The American central Bank known as the Federal Reserve has already hiked the bank interest rates. Many economists cautioned that hiking interest rates would plunge the banks into further crisis.

From those few of many examples of economic and political volatilities, it can easily be surmised that the world is not in a stable state as it was before the corona pandemic. Being a country in South Asia, there is nothing for us to be complacent believing that the world economic slump can’t touch us. Maybe after the 2008 financial crisis, this is the first time the world is being jolted unleashing fear in the minds of leaders of major economies.

Interestingly, over the last hundred years, the world has been shaken by four major economic events - the 1929 great depression - the black Monday crash in 1987, the.com crash in 2000 and the financial crisis of 2008. All of those began in the USA first before they spiralled out into other countries. So we should not play down the economic crisis all over the world this time. We have already begun to have its spillover effect. It is now even worse than the pre-pandemic situation.

We must be cautious enough to get ready to handle any kind of economic fallout. Being a part of the global village nothing should be taken lightly. Who knows, this could be the fifth economic crisis? We can’t predict which way world events will lead us.