World Economic Situation And Prospects 2009-2010
This document was uploaded by user and they confirmed that they have the permission to share it. If you are author or own the copyright of this book, please report to us by using this DMCA report form. Report DMCA
Overview
Download & View World Economic Situation And Prospects 2009-2010 as PDF for free.
More details
- Words: 925
- Pages: 19
World Economic Situation and Prospects 20092010 May 2009
Rob Vos United Nations
www.un.org/esa/policy
Main messages 1. 2.
Worst financial crisis since World War II Global economy is in recession • • •
3. 4.
Synchronized downturn, no green shoots yet Rising unemployment Setbacks in progress to poverty reduction and other MDGs
Downside risks of a prolonged global recession Policy challenges: • • • •
Further decisive and cooperative action is needed to restore the financial health of banks Fiscal stimulus measures should be better coordinated and aligned with global sustainable development objectives Deeper reforms of the international financial architecture should urgently be set in motion A new framework for global economic governance 2
Mar-06 May-06 Jul-06 Sep-06 Nov-06
Mar-07 May-07 Jul-07 Sep-07 Nov-07 Jan-08 Mar-08 May-08 Jul-08 Sep-08 Nov-08 Jan-09 Mar-09
Spread of interbank lending, %
Jan-07
Credit crunch in the US is easing somewhat… …
5.0
4.5
4.0 3.5
3.0
2.5
2.0
1.5 1.0
0.5
0.0 Jan-06
3
… but borrowing costs for developing countries remain elevated; private capital flows are reversing 10 Africa Asia Latin America Europe
8 6 4 2 0 Jan-07
Apr-07
Jul-07
Oct-07
Jan-08
Apr-08
Jul-08
Oct-08
Jan-09
Apr-09
4
World trade growth is collapsing 12
10.9 9.2 7.7
Annual percentage change
8
6.6 4.1
4
2.4
0 2004
2005
2006
2007
2008
2009
2010
-4
-8
-12
-11.1
5
After a plunge, oil prices are back to 2005 level 140
Nominal price Real price
$ per barrel, monthly average
120 100 80 60 40 20 0 2002
2003
2004
2005
2006
2007
2008
2009 6
Jul2002
Jul2003
Maize
Jan2003
Wheat
Jan2002
Jan2004
Jan2005 Jul2005 Jan2006 Jul2006 Jan2007 Jul2007 Jan2008 Jul2008 Jan2009
Rice
Jul2004
500
Jul2001
450
400
350
300
250
200
150
100
50 Jan2001
World food prices remain at lower levels, though still above historic levels
Index, 2000 = 100
7
World economy is in recession, recovery is uncertain 5 4.0
3.9
4
3.9 3.5
3 2
Optimistic 2.7
2.1 1.6
1 0
Pessimistic 2003
2004
2005
2006
2007
2008
2009
2010
-1 -2 -2.6
-3
8
World income per capita is declining in 2009 10
GDP per capita annual growth %
8 6 4 2 0 2004
2005
2006
2007
2008
2009
2010
-2 -4 -6 Developed countries
Economies in transition
Developing countries
9
60 developing countries will see declining incomes in 2009 (number of countries with declining per capita incomes) 70 60 60 50 40
Developed countries Economies in transition Developing countries
33
30 20
22 18 13
12
14
10
2
1 0 2008
2009
2010 10
Severe recession in developed economies 8 6.1
GDP growth rate, %
6 4.0
4 2
2.7
2.4
2.0 1.1
1.5
1.0
1.5 0.4
0.0
0.7 -0.1
0 -0.6
-2 -4
-0.4
-1.1
-3.5
-1.7
-3.7
-6 -7.1
-8
USA 2007
2008
Japan
EU15
2009
2010 Pessimistic scenario
2010 Baseline
NewEU 11
Sharp contraction of economic activity in the economies in transition… … 10
8.5
8 GDP growth rate, %
6.2 5.4
6 4.2
4 2
1.5
1.0
0 -0.3
-2
-0.6
-1.9
-4 -6
-5.4
South-eastern Europe 2007
2008
2009
CIS 2010 Baseline
2010 Pessimistic scenario
12
Developing countries are being hit hard through trade and finance channels • Spill-over effects through financial markets are hitting strongest on the middle-income countries • All developing countries are affected through slowing trade. • Primary exporters are also seeing deterioration in terms of trade • Low-income, net food and oil-importers are seeing improving terms of trade, but are suffering mainly through reduced demand for exports • Balance of payments constraints are emerging in growing number of countries and vast reserves are quickly evaporating 13
Leading to slowdown of growth in all developing countries 9.6
10
8.5
GDP growth rate, %
8 6
7.6 6.8 6.1
6.0
5.4 4.3
4.0
5.4 4.1
3.9
4 2
5.6
4.9
3.1
3.0 1.4
2
5.5
4.9 4.5
4.0 2.9
1.7
1.7
0.9
0 -0.7
-2
-0.7
-1.1 -1.8
-4
Developing countries
Africa 2007
2008
East Asia 2009
South Asia
2010 Baseline
Western Asia
Latin America
2010 Pessimistic scenario
14
3.Downside risks • Deeper and prolonged crisis (a)prolonged credit crunch in major economies and deeper recession (b)steep capital reversals in emerging markets (c)less ODA for low-income countries
• Global imbalances 15
120
135
0.70
0.80
0.90
Apr 04 Jul 04 Oct 04 Apr 05 Jul 05
Yen/US$
Jan 05
Oct 05 Jan 06 Jul 06 Oct 06
Euro/US$
Apr 06
Jan 07 Apr 07 Jul 07 Oct 07 Jan 08 Apr 08 Jul 08 Oct 08 Jan 09 Apr 09
The dollar volatility continues
105
90 Jan 04
0.60
16
…and global imbalances persist, though narrowing in deflationary spiral 600
United States
400
Japan
Billion US$
200
0
European Union -200
-400
-600
Developing countries (excl China) and EiT
-800
China 2004
2005
2006
2007
2008
2009
17
4. Policy challenges (1) • We have seen extraordinary responses to deal with the crisis – $18 trillion of public funding (30% of WGP) allocated to financial sector – $2.6 trillions fiscal stimulus (4% of WGP spent over 2009-2011) planned, less than the desired level of 2-3% of WGP annually – Financial landscape has changed – Coordinated monetary responses 18
4. Policy challenges (2) • More and even bolder action is needed: – Decisive and cooperative action is needed to restore the health of financial sector. – Align fiscal stimulus with global sustainable development objectives – Fundamental reforms of the international financial system are needed to overcome the systemic flaws 19
– A new framework for global economic
Rob Vos United Nations
www.un.org/esa/policy
Main messages 1. 2.
Worst financial crisis since World War II Global economy is in recession • • •
3. 4.
Synchronized downturn, no green shoots yet Rising unemployment Setbacks in progress to poverty reduction and other MDGs
Downside risks of a prolonged global recession Policy challenges: • • • •
Further decisive and cooperative action is needed to restore the financial health of banks Fiscal stimulus measures should be better coordinated and aligned with global sustainable development objectives Deeper reforms of the international financial architecture should urgently be set in motion A new framework for global economic governance 2
Mar-06 May-06 Jul-06 Sep-06 Nov-06
Mar-07 May-07 Jul-07 Sep-07 Nov-07 Jan-08 Mar-08 May-08 Jul-08 Sep-08 Nov-08 Jan-09 Mar-09
Spread of interbank lending, %
Jan-07
Credit crunch in the US is easing somewhat… …
5.0
4.5
4.0 3.5
3.0
2.5
2.0
1.5 1.0
0.5
0.0 Jan-06
3
… but borrowing costs for developing countries remain elevated; private capital flows are reversing 10 Africa Asia Latin America Europe
8 6 4 2 0 Jan-07
Apr-07
Jul-07
Oct-07
Jan-08
Apr-08
Jul-08
Oct-08
Jan-09
Apr-09
4
World trade growth is collapsing 12
10.9 9.2 7.7
Annual percentage change
8
6.6 4.1
4
2.4
0 2004
2005
2006
2007
2008
2009
2010
-4
-8
-12
-11.1
5
After a plunge, oil prices are back to 2005 level 140
Nominal price Real price
$ per barrel, monthly average
120 100 80 60 40 20 0 2002
2003
2004
2005
2006
2007
2008
2009 6
Jul2002
Jul2003
Maize
Jan2003
Wheat
Jan2002
Jan2004
Jan2005 Jul2005 Jan2006 Jul2006 Jan2007 Jul2007 Jan2008 Jul2008 Jan2009
Rice
Jul2004
500
Jul2001
450
400
350
300
250
200
150
100
50 Jan2001
World food prices remain at lower levels, though still above historic levels
Index, 2000 = 100
7
World economy is in recession, recovery is uncertain 5 4.0
3.9
4
3.9 3.5
3 2
Optimistic 2.7
2.1 1.6
1 0
Pessimistic 2003
2004
2005
2006
2007
2008
2009
2010
-1 -2 -2.6
-3
8
World income per capita is declining in 2009 10
GDP per capita annual growth %
8 6 4 2 0 2004
2005
2006
2007
2008
2009
2010
-2 -4 -6 Developed countries
Economies in transition
Developing countries
9
60 developing countries will see declining incomes in 2009 (number of countries with declining per capita incomes) 70 60 60 50 40
Developed countries Economies in transition Developing countries
33
30 20
22 18 13
12
14
10
2
1 0 2008
2009
2010 10
Severe recession in developed economies 8 6.1
GDP growth rate, %
6 4.0
4 2
2.7
2.4
2.0 1.1
1.5
1.0
1.5 0.4
0.0
0.7 -0.1
0 -0.6
-2 -4
-0.4
-1.1
-3.5
-1.7
-3.7
-6 -7.1
-8
USA 2007
2008
Japan
EU15
2009
2010 Pessimistic scenario
2010 Baseline
NewEU 11
Sharp contraction of economic activity in the economies in transition… … 10
8.5
8 GDP growth rate, %
6.2 5.4
6 4.2
4 2
1.5
1.0
0 -0.3
-2
-0.6
-1.9
-4 -6
-5.4
South-eastern Europe 2007
2008
2009
CIS 2010 Baseline
2010 Pessimistic scenario
12
Developing countries are being hit hard through trade and finance channels • Spill-over effects through financial markets are hitting strongest on the middle-income countries • All developing countries are affected through slowing trade. • Primary exporters are also seeing deterioration in terms of trade • Low-income, net food and oil-importers are seeing improving terms of trade, but are suffering mainly through reduced demand for exports • Balance of payments constraints are emerging in growing number of countries and vast reserves are quickly evaporating 13
Leading to slowdown of growth in all developing countries 9.6
10
8.5
GDP growth rate, %
8 6
7.6 6.8 6.1
6.0
5.4 4.3
4.0
5.4 4.1
3.9
4 2
5.6
4.9
3.1
3.0 1.4
2
5.5
4.9 4.5
4.0 2.9
1.7
1.7
0.9
0 -0.7
-2
-0.7
-1.1 -1.8
-4
Developing countries
Africa 2007
2008
East Asia 2009
South Asia
2010 Baseline
Western Asia
Latin America
2010 Pessimistic scenario
14
3.Downside risks • Deeper and prolonged crisis (a)prolonged credit crunch in major economies and deeper recession (b)steep capital reversals in emerging markets (c)less ODA for low-income countries
• Global imbalances 15
120
135
0.70
0.80
0.90
Apr 04 Jul 04 Oct 04 Apr 05 Jul 05
Yen/US$
Jan 05
Oct 05 Jan 06 Jul 06 Oct 06
Euro/US$
Apr 06
Jan 07 Apr 07 Jul 07 Oct 07 Jan 08 Apr 08 Jul 08 Oct 08 Jan 09 Apr 09
The dollar volatility continues
105
90 Jan 04
0.60
16
…and global imbalances persist, though narrowing in deflationary spiral 600
United States
400
Japan
Billion US$
200
0
European Union -200
-400
-600
Developing countries (excl China) and EiT
-800
China 2004
2005
2006
2007
2008
2009
17
4. Policy challenges (1) • We have seen extraordinary responses to deal with the crisis – $18 trillion of public funding (30% of WGP) allocated to financial sector – $2.6 trillions fiscal stimulus (4% of WGP spent over 2009-2011) planned, less than the desired level of 2-3% of WGP annually – Financial landscape has changed – Coordinated monetary responses 18
4. Policy challenges (2) • More and even bolder action is needed: – Decisive and cooperative action is needed to restore the health of financial sector. – Align fiscal stimulus with global sustainable development objectives – Fundamental reforms of the international financial system are needed to overcome the systemic flaws 19
– A new framework for global economic
Related Documents
World Economic Situation Prospects 2009
May 2020 12
Economic Situation Of Pakistan
December 2019 17
World Bank's Economy Prospects
June 2020 9
World Population Situation
June 2020 8
World Currency And Economic Meltdown
November 2019 18More Documents from ""
