GLOBAL ECONOMY WEEKAHEAD-Arresting the free fall in global trade
ECONOMY-WEEKAHEAD/OUTLOOK:GLOBAL ECONOMY WEEKAHEAD-Arresting the free fall in global trade
Sandra Fickweil
04-06-2009
1:00
According to the article, stabilization may soon be visible in the world trade.
At the last week's Group of 20 summit $250 billion are planned to support trade financing. The former director of international trade for the World Bank said that he was terrified by the numbers he has seen on trade.
The article says that import from Asia to the United States is still shrinking and containers arriving in California dropped by 43% from a year before. Although the numbers of international economy are still not good, other readings suggest that the severity of the global economy's downturn might be starting to ease.
Steep declines in exports are seen in all countries around the world. Hans Timmer a World Bank economist said "that is really unheard of that it happened so suddenly, it happened in every country. It happened in the high-income countries and it happened in the developing countries."
However the text suggests that due to some indicators, the worst of the global recession may be soon over and stock markets worldwide may rise soon. This is due to recent surveys of factory activity in the United States, Europe and China that showing that companies have recovered from record lows, and U.S. consumers have resumed buying more than just the basics.
In China for example, the $585 billion government burst revives growth: for the first time since September the market grows. However China is until now the only country that shows improving numbers of import.
Despite the big effort that the Group 20 has made, soon change in trade is not expected. According to Barack Obama, the days of the "voracious" U.S. consumer underpinning strong growth were probably over.
According to Fred Crawford, "the future size and shape of virtually every business in America as well as those businesses that export goods to America rests upon a simple equation—how much Americans think they need to save versus how much they think they can afford to spend."
It appears that this recession changes dramatically due to the mindset of Americans according to the author.
I followed the news about the preparation as well as about the results of the summit of the Group of 20 that took place last week in London, Great Britain. I was really surprised about the outcome, especially the way that newspapers wrote about it. Although everyone knows that it will take a lot of time and patience until the worldwide recession is over, peoples' mind start to change as they see and realize that governments try to change. I was really surprised when I read this article that says that change can already been seen a little. I think that is a wonderful sign and I hope that it will not be too late for most companies when the real change takes place.
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