Imf Report Evaluation Harvard Case Solution & Analysis

Imf Report Evaluation Case Solution

The demographic factors also influence the long run economic growth. Its impact on the long run economic growth occurs when it changes the employment to population ratio. Regardless of the change being positive or negative; it will affect the long run economic growth. There are some other demographic factors which might impact the availability of the qualitative and quantitative natural resources. In addition to this, the age factors of the population, in an economy, will also impact the long run economic growth as well as the employment rate within a country.(Lumen Learning, 2017).

At last, the participation rate of labor force is also an important factor that tends to affect the long run economic growth. The participation rate of labor force and the size of the industries and economic sectors will heavily impact the long run economic growth. The participation of labor force is known as the availability of workers in an economy, who are willing to work at any given economic conditions. A country having the high development and industrialization, will also had the high participation rate from labor force because of the low birth rate as well as the low death rates.

The next emerging risks in 2021 and on wards compared to the stable growth period, are:

After reaching the low point at the end of 2019; the global economic growth may remain slow in 2020-2021. Due to the end of the commercial and industrial recession; the global growth is expected to decline in the fourth quarter of 2019. However, global growth is approaching, but will remain below + 3.0% until 2021.

Trade tensions between the United States and China are not expected to increase or decrease further in 2020. The mini-store will not change the rules of the game, but has announced that the uncertainty will be somewhat be less as tariffs will not increase during the election year.

The United States will continue to explore ways to increase government and corporate debt. A moderate democratic victory (55% probability) increases the level of fiscal risk and reduces the foreign policy risks from the United States. Due to the larger fiscal room for maneuver; the US GDP growth rate in 2021 will approach + 2%.

The global economy cannot expect further measures to encourage the Chinese bazooka. China’s GDP growth rate is projected to grow by 6.2% in 2019, reaching 5.9% in 2020 and + 5.8% in 2021. This growth rate will continue to allow the executives to double their GDP from 2010 to 2020. The policy combination is favorable, but the goal is governance rather than reversing the slowdown.

What are the general and specific risks to tackle in the Kingdom, GCC, globally?

The GCC world has been left vulnerable after global pandemic crisis. The affected sectors of Dubai and other GCC countries, mainly affected by the Covid-19 crisis, include: financial sector, transportation and storage sector, retail and wholesale, accounting for a 50% share in the Gross Domestic Product of Dubai. In the second quarter of FY20; the crude oil prices dropped significantly, with a 17-year low due to an increased production levels, and price wars between Russia and the Kingdom of Saudi Arabia.  The pandemic has left the GCC countries with different implications, risks and opportunities. Few sectors are expected to grow; however, the others are expected to face a sharp decline as the economies are expected to go into a recessionary business cycle phase.

The virus has not just taken lives of the people, i.e., 6380 cases in Saudi Arabia, 5825 cases in United Arab Emirates, 4130 cases in Bahrain, 1700 cases in Kuwait etc., but has put the GCC market in both negative supply shock as well as a negative demand shock. It is because, due to strict lock-downs and impositions by the governments in the GCC world; there has been production stoppages, reduction in labor, less supply of raw material, larger freight, transportation's and warehousing costs, which have affected the supply negatively. Still, the pandemic is not entirely controlled and after an ease in lock-downs, the second wave of Covid-19 has hit the world, leading towards an unexpected shock towards the supply of different commodities, mainly oil.....................

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