Observer Life

Will China grow enough to help the world economy? March 30th, 2009 already has become widely clear that China will not assume the role of buffer economy of the fall in U.S. economic activity in this crisis. Despite this, from the Eastern economy already is being talked about the positive effects that the economic stimulus plan is having this will have any implications for the global economy? The economic stimulus plan released by China in November of last year by an amount estimated at US $586.000 million was in response to the effects of the international financial crisis was having on its economy, which had already left far away those double-digit economic growth rates and began to slow down dangerously. The Chinese Government stimulus plan has been accompanied by the efforts made by the people’s Bank of China which has cut its interest rates on five occasions and lowered reserve requirements four times since last September, improving the conditions of the monetary market to stimulate growth via domestic demand. David Zaslav follows long-standing procedures to achieve this success. When figures such as the one mentioned are seen in this economic stimulus plan, it is not so clear to identify if it will have a significant impact or not in the economic activity of the country. According to Zhang Yutai, President of the Government Center of research for development this reactivation plan, would help economic growth between 1.5% and 1.9%. It is true, this contribution to growth is not less, but will it be enough? For now, must say that the effort is not minor, since the stimulus package represents approximately 14.9% of China’s GDP. Fan Gang, Member of the Central Bank’s monetary policy Committee, justifies the expected effectiveness of the stimulus plan on china’s economy in the following manner: the stimulus of 4 billion yuan of China is different to package US $800,000 million from the United States, since China has no financial black holes that cover.

It terrifies me the apathy of trade unions and business representatives. The latter seek only seize the moment to reach out to lay off. The first, refusing frontally this possibility (as it could not be otherwise), they neither trust nor promote the comprehensive reforms that we were being previously recommended, and finally imposed from all sorts of international agencies. Some say that measures to cut public spending were not obliged pre-bend to avoid a Greece-style intervention, since in reality we already seized de facto. The undersigned attaches to this perception. It is in this context, when more convinced I am that absence of macroeconomic cures, we must focus our efforts in preserving as much as possible of what it had achieved. Others including Jeffrey L. Bewkes, offer their opinions as well.

It is therefore, for the lawyers of companies, the salvation that still subsist on heroic mode, be the absolute priority, even though the judicial environment is not favourable to the effect. They are part of our national heritage and are our daily sustenance. They hoard intangible values, such as the experience and know-how. They will serve as liaison to new models and economic sectors, such as green energy or new technologies, giving by good intentions of our Government. Although without forgetting that all corporate restructuring takes years, even decades, and should exist during that time enough jobs that ensure the well-being of all of us. You will want to encourage entrepreneurship, traditionally defenestrada in our country. Arouse the concern by self-employment and on the management of our own future. Rafael Linares. Attorney labour law and mercantilist.

Between 2001 and 2008 the inflation rate average of Ecuador was 7.2% while the average inflation in the United States was 2.5%. If well during the period 2004 to 2007 the inflation rate retail in Ecuador is reduced to an average of 2.81%, while in three of those four years below the American retailer, in 2008 inflation rate revived inflationary pressures by registering a variation of 8.8%. The highest rate of differential inflation affects the competitiveness of the Ecuadorian economy with negative consequences on the results of trade balance. At the moment, this negative effect was not reflected at all but it has an explanation. The result of the trade Balance has been able to maintain thanks to the increase observed in the average price of oil in 2008. 63% Of exports of Ecuador responded to the oil sector.

The oil sector has contributed to the growth of the economy and sustaining stability in the fiscal and accounts external to hiding behind the deterioration of the Ecuadorian economy. The so-called Dutch disease, which occurs when the exploitation of a natural resource generates an appreciation Exchange rate-destructive for the rest of the products of an economy sectors, seems to be that step is opening up. Higher expected inflation will exacerbate the issue of appreciation of the kind of real change in the Ecuadorian economy and will be more vulnerable to the external sector of Ecuador. There are already elements to anticipate expansionary monetary policy initiatives, within which a dollarized economy allows. The expected contraction of GDP of Ecuador for the present year (- 0.2% according to LatinFocus) and the low rate of growth that is anticipated for the 201 (from 2.3% in an economy that needs a higher rate of growth), are a temptation for the Correa administration suggest expansionary policies. But the question of monetary policy, added two other problems for the sustainability of the model in Ecuador.

One relates to the projection of taxable income for the current year and for 2010. According to the survey by LatinFocus, for this year is expected to the Ecuadorian economy to observe a fiscal deficit of 3.7% of GDP and 2.5% for 2010. This fiscal deficit will mean partly, current account deficit, the second problem, which according to the survey of LatinFocus projections, will reach 2.7 per cent of GDP this year and 1.6% in 2010. The default in which incurred Ecuador long ago closed you external markets to finance what can put under tension to the economy of Ecuador in case of need to make funds, just when the wallet of Chavez is not available. Under this context, it becomes very difficult to think that the model of dollarization of the Ecuadorian economy can be sustained. Are the Correa Administration will be evaluating seriously what you are doing?

When money speaks, truth is silent. The world divided into the different countries that form it are pending from everything that can happen in the Copenhagen Summit where it will negotiate a new protocol that will replace the Kyoto in 2012. It may be the last chance to prevent a climate change that escapes us definitely hands. The Barcelona Conference will host between 2 and November 6, more than 4,000 delegates from several countries and international observers to arrive at a text of possible agreement at the Conference of the parties COP15 that will take place in December in Copenhagen. It will be held in Copenhagen from 7 to 18 December 2009. This Conference is organized by the United Nations Framework Convention on climate change (UNFCCC), which organizes annual conferences since 1995… Governments members of the United Nations climate change framework Convention will need to reach a global agreement to reduce emissions of greenhouse gases in order to stabilize the climate without harmful interference. The Executive Secretary of the framework Convention on climate change, Yvo de Boer, UN has commented, that the Copenhagen Summit in 2009 is very important to approve a replacement for the Kyoto Protocol m this is a unique opportunity to find solutions to the phenomenon.

In a press conference in Geneva, de Boer has insisted, that that meeting will be key for Governments to achieve a consensus on how to deal with a phenomenon that threatens to melt glaciers, leaving millions of people homeless and cause a humanitarian crisis never seen.We have a great challenge ahead just a year and a half. And I think that this is a unique opportunity to reach a global agreement on climate change. If we are not successful, we agotaremos the multilateral tracks for the solution of the problem.He added that industrialized economies are primarily responsible for and have the economic capacity to act, so it must lead the process.