As monetary and fiscal authorities have acted aggressively to blunt the COVID-19 pandemic’s economic impact, public debt and central-bank balance sheets have swelled rapidly. In the European Union, this trend is compounded by a new €750 billion ($886 billion) COVID-19 recovery fund, which includes the issuance of so-called “recovery bonds” guaranteed by the EU’s multiyear budget and, possibly, by Europe-wide taxation.
After arduous negotiations between member states’ governments last month, European Union leaders are celebrating their agreement on a €750 billion ($886 billion) rescue package for EU countries hit hard by the COVID-19 crisis. But it is too soon to pop open the champagne. The plan for the “Next Generation EU” recovery fund has two major weaknesses that will make it not only ineffective but also a threat to the eurozone’s very existence.
COVID-19 has become a severe stress test for countries around the world. From supply-chain management and health-care capacity to regulatory reform and economic stimulus, the pandemic has mercilessly punished governments that did not – or could not – adapt quickly.
This year is the twentieth anniversary since the adoption of the UN Convention Against Transnational Organized Crime, and its historic Protocol to Prevent, Suppress and Punish Trafficking in Persons, Especially Women and Children. This Protocol established the first internationally recognized definition of trafficking in persons; a definition that has stood the test of time.
For the last two decades, Lebanon had been living off capital inflows, averaging 20% of GDP per year. Thanks to high interest rates, deposits – largely denominated in US dollars – grew to about 400% of Lebanon’s GDP, with much of the money being lent to the state to finance large fiscal deficits. Last July, the current-account deficit was over 25% of GDP, and public debt exceeded 150% of GDP. Government securities and deposits at the central bank accounted for 14% and 55% of bank assets, respectively, for a total sovereign exposure of nearly 70% of assets. Meanwhile, GDP growth has been close to zero since 2011.
What do the Calabrian organized crime syndicate ‘Ndrangheta, Hertz, China’s Sichuan Trust, and the US Federal Reserve have in common? They are all deeply entangled in a financial system that has turned credit intermediation into a debt mint that produces assets to enrich investors but leaves households, firms, and governments struggling with unsustainable liabilities.
On July 17-18, European Union leaders will meet in Brussels to try to reach an agreement on the bloc’s proposed €750 billion ($852 billion) recovery fund. Member states currently disagree on several issues, including the shares of grants and loans in the package and which conditions, if any, should be attached to the disbursements. But once leaders clinch a deal, the most important question will be how member states should spend the money. The answer is far from obvious.
In just a few short months, the COVID-19 pandemic has done massive damage to the United States economy – and the workers who make it run. Unemployment has already reached its highest level since the Great Depression, with about 42 million workers – largely lower-income, less educated, and disproportionately black and Hispanic – having filed jobless claims since mid-March. Without concerted government action, America’s economic prospects – and its inequality problem – will only worsen.
One effect of the COVID-19 lockdowns this year is that many young adults have returned home temporarily to stay with their parents, subletting their apartments to others in need. For those who have lost their jobs, the rent paid by these tenants has doubtless provided a welcome and necessary safety net. Thanks to the modern gig economy, victims of the downturn can operate like corporations, “sweating” their balance sheets to maximize the income from their existing assets.
The virus, Sars-cov-2 till date has claimed the lives of lakhs of people around the globe and the number of infections have been increasing with no sign of slowing down. It is not a new fact that this virus has affected each and every sector of the nations causing massive economic fallouts,public health crisis,inequity and insecurity over life hence giving birth to a global pandemonium. Amidst the pandemic, all sectors of an economy are affected among which education is one.
In his novel Chronicle of a Death Foretold, Gabriel García Márquez describes a tragedy that everyone anticipates but no one will stop. The same is true of the perilous plight of emerging markets today: the international community could prevent imminent macroeconomic disaster, but seemingly lacks the will to do so.
Relation between Nepal and India has the foundation based on close historical, cultural, religious and people-to-people ties. However, the strategic ties between them is based on the Sugauli treaty that was signed between the British East India Company and the Nepalese regime in 1816 which demarcates the Nepal-India border.
The €500 billion ($547 billion) COVID-19 recovery fund proposed by German Chancellor Angela Merkel and French President Emmanuel Macron has been hailed as a turning point for the European Union – and for good reason. Beyond its concrete economic implications, the proposal reaffirms a commitment to solidarity by the EU’s two largest economies, thereby setting the stage for genuine progress toward fiscal union.
When the 2008 global financial crisis erupted, China’s exports collapsed, threatening massive job losses. In response, China unleashed the world’s biggest-ever construction boom, pouring more concrete between 2011-13 than the United States did in the entire twentieth century.
Credit rating, in general is a quantified assessment of the credit worthiness of any entity such as corporations, conglomerates, autonomous governments or even a country. It is the symbolic indicator of the opinion of Credit Rating Agency with reference to the capability of the issuer to repay the debt as per its terms. The rating is assigned by an independent credit rating agency based on substantial evaluation of key parameters of the entity. Standard and Poor’s (S &P), Moody’s and Fitch Ratings are some of the prominent examples of international rating agencies which has captured more than 95% of the credit rating business in an international market.