Global Prospects and Their Likely Impact on South Africa Essay

3275 Words Jul 22nd, 2010 14 Pages
GLOBAL PROSPECTS AND THEIR LIKELY IMPACT ON SOUTH AFRICA

INDEX:
Table of Contents
Global prospects and their likely impact on South Africa 1
INDEX: 1
Strength of the Recovery 2
Developed Countries: 2
Emerging Markets: 2
Risks to the Global Economy 3
Exit Strategy from Policy Stimulus 4
Repair and reform of the financial sector 4
Fiscal Crises and underinvestment in Infrastructure 4
Socio and Political Implications of Unemployment and Private Demand 5
Asset Price Collapse and the risk appetite of investors 5
Return to Previous Growth Path or Not 5
Will the current crises be “DÉJÀ VU ‘” for the world wide economy? 6
Fundamental Changes in Origins & Nature of Economic Activity 6
Global warming / Climate Change: 7
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The number of unemployed people fell by 33,000 to 2.45 million in the three months to January (compared with the previous quarter), which is the lowest level for almost a year and the largest decline over a three-month period for almost three years.
Average weekly earnings also increased during the three-month period up to January 2010, namely by 1.4% (compared to a year ago), up slightly from 1.2 per cent in the quarter to December. (Roelof Botha – Macroeconomic report)

Emerging Markets:
Several emerging market economies are expected to return to pre-recession growth trajectories during 2010, with China and India having defied the global economic downturn altogether.
CHINA
China has been leading the pack of a growing number of emerging markets that are rapidly closing the GDP gap between developing nations and post-industrial economies.
In mid-March, The World Bank raised its growth forecast for China for 2010 to 9.5%. In November last year, the bank’s forecast for 2010 growth was 8.7%. Other forecasting agencies are even more optimistic, with the OECD forecasting growth of 10.2% in 2010, dropping marginally to 9.3% in 2011. (www.economist.com)
INDIA
According to provisional estimates by the IMF, India’s GDP recorded a real growth rate of 5.4% in 2009 and the forecasts for 2010 & 2011 are 6.4% and 7.3%,