Global Policies Needed As Economic Slowdown Spreads In Asia
The world is experiencing an economic slowdown that's threatening to happen everywhere. Policymakers need to make efforts to stop it, according to SCMP.
When the slowdown comes to a halt, there is a very real chance it'll turn into a crash similar to that which happened in 2008. Interest rates have dropped and borrowing rates have been deemed "super-friendly"-on the contrary, the world should be enjoying an era of progress.
The revival of the corporate sector and its productivity-driven lines and capital-intensive processes have shown definite signs of stalling, and analysts are not positive about what could happen as it finally stops. The world is showing signs of "global growth anemia" as major economies are growing stagnant, though it is partially beyond their control, as countries are imposing tariffs when they shouldn't.
Global economic confidence, according to analysts, is at an all-time low as well. It needs to have a major reboot and soon. Everyone needs to "pull their own weight;" the Fed must keep with its rate cuts if only to help the global economy to recover. Market expectations have 0.75 percent being taken off US official rates this year, which is not such an outlandish number.
Even China has suffered the effects of the global economic slowdown with its lowest growth in almost 30 years. According to NPR, the world's second-largest economy posted a growth of 6.2% around the second quarter of 2019. This showed a drop-down from 6.4% in the first quarter, according to data released by the Chinese authorities. This marked the slowest growth since 1992.
Such a slowdown isn't unheard of, especially in a global economic scenario such as what's happening. However, China's economic stalling is happening out of nothing. Beijing and Washington have yet to patch things up concerning the trade dispute between the two; hence, the global economic slowdown that China's suffering is impacted by this.
It is revealed that the US president is threatening to impose a new round of tariffs on $300 billion worth of additional goods from the country. Analysts see this as a momentary truce after the US president and Chinese President Xi Jinping met at the G20 summit. The summit resulted in what has been allegedly a resumption of trade talks between the two.
Beijing will surely introduce more efforts to shore up domestic demand. The trade war is taking its toll for sure, but China is also not immune to feeling the effects of a global stagnation of economies. It's simply bad timing that the US and China are still locked in a trade dispute as this happens.