October 17, 2013

The Global Growth Slowdown

After the Asia-Pacific Economic Cooperation (APEC) meeting held in Bali, Indonesia, Asian leaders find global growth outlook at risk. The global growth slowdown is exemplified by increasing youth unemployment all over the world. Despite the positive output globally, young people are finding it hard to land a job. According to Stiglitz's (an Economist) estimation, 27 million Europeans are jobless while 22 million Americans who are looking for a job are find it hard to land one.

With Western Countries under the boiling point, Emerging Markets (EMs) are seen to boost the global growth. Yet, some of the EMs are relying on Western Countries, like Philippines, in terms of employment; the balancing comes from Asian and Middle East regions. According to government statistics, majority of Overseas Filipino Workers (OFWs) employers are from Singapore, Hong Kong, and Middle East. Thus, the growth of OFW remittance would be significantly affected by the response of Asian and Middle East countries to global growth slowdown.

On the positive side, because growth is likely to slow in western region, investments are seen to fall down in Asia. It is also seen that Private Public Partnership (PPP) projects will play a big role in pushing the growth of the region; development of energy sector will have multiplier growth effect. Moreover, with high mass consumption of Asia, investments are seen in services and tangible products (electronics, food, and the likes).

The key to global growth optimization is being open to investment and willingness to invest in other countries.

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