![]() Recent incidences of financial stresses are also a reminder that tightening financial conditions can generate tensions between central bank policies and financial stability objectives, and fuel unintended consequences.” Pedro Conceição, Director, Human Development Report Office, United Nations Development Programme“The impact of tighter financial conditions will depend on their interaction with growth prospects and pressures on public finances. As a result, significant structural shifts are unfolding across a broad range of economic sectors and offering new vistas for investment and growth.“However, further increases in interest rates and/or interest rates staying higher for longer will certainly pose challenges from realizing the full potential of these trends. This is largely attributed to areas such as services enjoying a prolonged resurgence in post-pandemic demand as well as the mainstreaming of potent forces such as technology, innovation, digitalization, clean energy, sustainability, and ESG. Tightening financial conditions have dampened the growth momentum and increased volatility, but overall economic conditions continue to remain resilient. Rima Bhatia, Group Economic Adviser, Gulf International Bank“Despite the most concentrated cycle of interest rate hikes in recent times to tackle persistent inflation, most notably by the US Federal Reserve, the global economy has surpassed all expectations. How are tighter financial conditions likely to impact progress on global development in the coming years? Given the gloomy development landscape, we asked five of the chief economists about how tighter financial conditions are impacting global development and how governments and businesses can best work together to tackle development challenges.Here’s what they had to say. Most chief economists surveyed said they expect future progress towards development goals to be undermined by geopolitical tensions (74%) and tighter financial conditions (59%). As the UN itself notes, the world is “ nowhere near” reaching the goals, as compounding geopolitical and geoeconomic issues continue to hinder progress.The World Economic Forum’s latest Chief Economists Outlook report - published ahead of the Forum’s annual Sustainable Development Impact Meeting in New York, 18-22 September 2023 - also paints a somewhat pessimistic picture of the current trajectory for global development. ![]() This year marks the halfway point to the 2030 deadline for the United Nations’ Sustainable Development Goals (SDGs). We asked five chief economists how governments and businesses can collaborate to advance development goals.The World Economic Forum’s Chief Economists Outlook report highlights the challenges ahead for global development.Progress towards achieving the Sustainable Development Goals by 2030 has been slowed by global crises.
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