Beating the sluggish syndrome

Hardly had the euphoria of economic recovery lived a while that the pundits of gloom popped up a warning.

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Published: Sat 11 Sep 2010, 11:13 PM

Last updated: Mon 6 Apr 2015, 1:50 PM

A recently released report of the Organisation for Economic Cooperation and Development forecasts that global economic recovery is slowing faster than expected, and thus desperately is in need of extraordinary measures to get going. Apart from soliciting a blanket stimulus package, the world economy is in need of stringent regulation measures. But what makes the OECD report quite disturbing is the projection that sluggishness of the economy would hang on for a considerable period of time to come. This means the host of measures undertaken by world governments, including robust bailout packages and austerity drives are not working. As rightly pointed out in the report, the need of the hour is to find out whether the slowdown reflected temporary factors or it signalled deeper constraints.

The diagnosis offered by OECD is worth considering: it says if the prevailing sluggishness proved to be longer lasting, governments could boost stimulus measures or otherwise stick to austerity measures by continuing to curb public spending. Few would agree with this two-edged but indecisive approach, as it mired a seems in chaos and confusion. The world economy can neither afford another Wall Street adventure nor allow respective governments to sit back idle and watch growth indicators go astray. The ongoing recession is an outcome of greed and arrogance, and that has much to do with hands off ad hocism approaches adopted by all the major economies in the garb of free market regulation. This has pained all and sundry and pushed the world deep into a quagmire of uncertainty. Moreover, there can’t be a fit-for-all strategy and every country has to tailor its own policies as per real politick.

While much stress has been laid on macroeconomic indicators, a rundown of micro issues it needed. Unemployment and poverty alleviation are issues that need a collective global approach, as they are no more confined to fudging of figures and statistics. Rather, the political uncertainty and restlessness is owing to the absence of social mobility and opportunities to grow and prosper. Political dispensations worldwide can no more brush the realities under the carpet in the name of national security or virtual assessments of terrorism. Something real is in need of being done, and an apt approach could be to relieve the ailing economies of Africa, Asia and the Caribbean’s of their debt burden, and injecting them with a psychological newness of rebirth in terms of growth and productivity. The policy of loans, in the absence of aid and trade, has further complicated the mess. Painting a dismal picture would not help. The need is to choreograph a rescue strategy. Free flow of men, material and technology can help break the bonds of the crippling recession.

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