News

Global Economy Still Viewed as Fragile

Joe DeCapua

Business, government and civil society officials are expressing greater confidence in the world economy over the next 12 months. However, the Global Confidence Index also shows they believe the economy remains on very shaky ground.

The managing director of the World Economic Forum says the index is a bit more encouraging than the previous quarterly survey. However, Lee Howell says it’s nothing to celebrate.

“I think the Global Confidence Index, in terms of what you saw with the latest results, it’s good news, but it’s relative. Relative to really the great uncertainty and concern that were seen in the last quarter, which, as you know, if we look back in December and January, at the close of last year and the beginning of this year, lots of uncertainty. Particularly around what was happening in the Euro zone,” he said.

Lee Howell, World Economic Forum managing director
Lee Howell, World Economic Forum managing director

This includes the economic turmoil over Greece’s debt and debt concerns in other European countries as well.

Economic, political shocks

The index shows fear of a major economic disruption dropped from 63 percent of the respondents last quarter to 46 percent in the first quarter of this year.

“The survey clearly shows that people are less concerned about a major economic disruption in the next 12 months. However, and this is the big however, is that they’re more concerned about geopolitical shock. And it’s obvious that we live in a world where geopolitical shocks would absolutely impact the geoeconomic space,” Howell said.

Potential sources of geopolitical shock include Syria, Iran and North Korea.

“Unfortunately,” he said,  We kind of live in a world where there are a number of places where this shock could come from at any given moment.”

Cautious optimism?

Overall, Howell says the index does not indicate a return to cautious optimism. Instead, it’s more a feeling of being less alarmed.

There’s growing concern, he says, that the established economic, business and political systems that fared well in the 20th Century may not be up to the task in the 21st Century.

“We’re seeing at least in the industrialized world a real concern over structural issues, structural unemployment. And also an appreciation that the monetary and fiscal remedies that were put forth in the 70s and 80s and 90s have maybe run their limits in that fact that we’re dealing with a period of major structural change, economic level,” he said.

The index says there’s a perception of a lack of bold leadership around the world and an unwillingness to cooperate to solve common problems.

“What is missing is the efforts of particularly those who are in the leadership position sort of connecting the dots for the public and saying, if we do this and we handle this policy issue, it is going to impact this other issue. Or if we actually focus purely on this from a national context, we’re going to miss the big story because globally this is happening. I think we need a much more of a holistic and systematic approach and frame these issues for the public,” he said.

The next Global Confidence Index will be released in August. About 1200 international experts will be questioned about global economic and political issues.

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Olympics Construction Scars Sacred Korean Mountaini
X
July 02, 2015 4:10 AM
Environmentalists in South Korea are protesting a Winter Olympics construction project to build a ski slope through a 500-year-old protected forest. Brian Padden reports that although there is strong national support for hosting the 2018 Pyeongchang Winter Olympics, there are growing public concerns over the costs and possible ecological damage at the revered mountain.
Video

Video Olympics Construction Scars Sacred Korean Mountain

Environmentalists in South Korea are protesting a Winter Olympics construction project to build a ski slope through a 500-year-old protected forest. Brian Padden reports that although there is strong national support for hosting the 2018 Pyeongchang Winter Olympics, there are growing public concerns over the costs and possible ecological damage at the revered mountain.
Video

Video Xenophobia Victims in South Africa Flee Violence, Then Return

Many Malawians fled South Africa early this year after xenophobic attacks on African immigrants. But many quickly found life was no better at home and have returned to South Africa – often illegally and without jobs, and facing the tough task of having to start over. Lameck Masina and Anita Powell file from Johannesburg.
Video

Video Family of American Marine Calls for Release From Iranian Prison

As the crowd of journalists covering the Iran talks swells, so too do the opportunities for media coverage.  Hoping to catch the attention of high-level diplomats, the family of American-Iranian marine Amir Hekmati is in Vienna, pleading for his release from an Iranian prison after nearly 4 years.  VOA’s Heather Murdock reports from Vienna.
Video

Video UK Holds Terror Drill as MPs Mull Tunisia Response

After pledging a tough response to last Friday’s terror attack in Tunisia, which came just days before the 10th anniversary of the bomb attacks on London’s transport network, British security services are shifting their focus to overseas counter-terror operations. VOA's Henry Ridgwell has more.
Video

Video Obama on Cuba: This is What Change Looks Like

President Barack Obama says the United States will soon reopen its embassy in Cuba for the first time since 1961, ending a half-century of isolation. VOA White House correspondent Luis Ramirez reports.
Video

Video Hate Groups Spread Influence Via Internet

Hate groups of various kinds are using the Internet for propaganda and recruitment, and a Jewish human rights organization that monitors these groups, the Simon Wiesenthal Center, says their influence is growing. The messages are different, but the calls to hatred or violence are similar. VOA's Mike O’Sullivan reports.
Video

Video US Silica Sand Mining Surge Worries Illinois Residents, Businesses

Increased domestic U.S. oil and gas production, thanks to advances known as “fracking,” has created a boom for other industries supporting that extraction. Demand for silica sand, used in fracking, could triple over the next five years. In the Midwest state of Illinois, people living near the mines are worried about how increased silica sand mining will affect their businesses and their health. VOA’s Kane Farabaugh has more in this first of a series of reports.
Video

Video Blind Somali Journalist Defies Odds in Mogadishu

Despite improving security in the last few years, Somalia remains one of the most dangerous countries to be a journalist – even more so for someone who cannot see. Abdulaziz Billow has the story of journalist Abdifatah Hassan Kalgacal, who has been reporting from the Somali capital for the last decade despite being blind.
Video

Video Texas Defies Same-Sex Marriage Ruling

Texas state officials have criticized the US Supreme Court decision giving same-sex couples the right to marry nationwide. The attorney general of Texas says last week's decision did not overrule constitutional "rights of religious liberty," and therefore officials performing wedding services can refuse to perform them for same-sex couples if it is against their religious beliefs. Zlatica Hoke reports on the controversy.
Video

Video Rabbi Hits Road to Heal Jewish-Muslim Relations in France

France is on high alert after last week's terrorist attack near the city Lyon, just six months after deadly Paris shootings. The attack have added new tensions to relations between French Jews and Muslims. France’s Jewish and Muslim communities also share a common heritage, though, and as far as one French rabbi is concerned, they are destined to be friends. From the Paris suburb of La Courneuve, Lisa Bryant reports about Rabbi Michel Serfaty and his friendship bus.
Video

Video Saudi Leaks Expose ‘Checkbook Diplomacy’ In Battle With Iran

Saudi Arabia’s willingness to wield its oil money on the global diplomatic stage appears to have been laid bare, after the website WikiLeaks published tens of thousands of leaked cables from Riyadh’s Ministry of Foreign Affairs. VOA's Henry Ridgwell reports.
Video

Video In Kenya, Police Said to Shoot First, Ask Questions Later

An organization that documents torture and extrajudicial killings says Kenyan police were responsible for 1,252 shooting deaths in five cities, including Nairobi, between 2009 and 2014, representing 67 percent of all gun deaths in the areas reviewed. Gabe Joselow has more from Nairobi.

VOA Blogs