Surname 1

Name:

Lecturer:

Course:

Date:

World Affairs: Global Economy

The 21st century exhibits myriad of global economic challenges that emanate from an

enhanced process of globalization. Many countries have benefited from globalization; however,

increased interconnectedness has created uncertainties including trade front tensions, financial

and fiscal risks that have adversely affected the efficiency of the global market. Concerning this

perspective, this assessment explores challenges and opportunities experienced in addressing the

issue, lessons deduced from the concepts and whether there is a solution or management of the

problem.

The effort to solve the global economy faces potential impediment in the sense that some

players tend to portray a minimum commitment to multilateral cooperation disregard the essence

of climate change and criticize open and free trade. This barrier creates uncertainty among the

international trade partners and presents a substantial threat to financial fundamentals and

macroeconomic initiatives of the affected nations. The major international players feel the strains

of lack of commitment that threatens international cooperation. Further, the growing income

inequality is among the chief obstruction to the global economy where stock price and growth of

the economy does not spread equally in countries that enter in trade agreements. For instance,

Asia-Pacific’s private wealth has the potential to surpass Western Europe’s that can severely tilt

the political and economic power of the affected trade block (Wharton University of

Pennsylvania). Further, lack of global cooperation among the players suppresses living standards
 Surname 2

and job opportunities among the players in advanced and emerging markets (Zhang). This is

attributed to detrimental policies that generate negative spillovers, the tension between nations

and interrupt the free flow of investment and goods.

The United States and the European economies have faced polarized income distribution

due to barriers related to productivity issues and adjustment to inflation. The International

Monetary Fund states that the world has strived to recover from the global financial crisis in

which the slow productivity across the countries has thwarted the progress. Emerging and

advanced markets and low-income countries have failed to conform to the recent technological

advancements and innovations. Low wage growth and inflation across the world result in a

minimal push for nominal wages in Japan, Germany, and the United States that is attributed by

declining dynamics of the labor market (Zhang).

Regardless of the challenges, the effort put to address the world economic uncertainties

present opportunities to the players. For instance, the initiative tends to leverage

interconnectedness for the benefit of the entire stakeholders as the contemporary world connect

people economically whereby global trade can increase. There is the possibility that

multilateralism can be adjusted to meet the emerging demands through technological changes.

Involved countries can rely on the technology to change their global contexts, digitize their

operations, anticipate demographic changes, and address climate change (Gurria). Global

economy offer prospect to tackle deeply rooted development hurdles.

The 2030 Agenda can help introduce new financial agenda that would help achieve

economic sustainability such as long-term value creation rather than short-term revenues. The

policymakers of the involved nations can coordinate the financial systems with elaborate foreign

exchange, fiscal and monetary policies that will support stable global financial environment
 Surname 3

(United Nations Department of Economic and Social Affairs). Accordingly, the initiative can

contribute to the desired growth of the GDP of the international players and uplift the economic

level of the developing nations.

The issues can be related to findings of Kissinger (204) which emphasize that computer

networks and smarts devises can generate environmental, economic, and social efficiencies

across the global networks. In other words, the international affairs realms should adopt the

principles of networked communication that would soften political contradictions that influence

economic initiatives of the globe. The network of communications can harness global systems

should be the foundation that policymakers should rely upon to eradicate optimism to the global

economy. Growth and creativity should be based on perspective where the entire individuals get

the opportunity to express views and injustices; similarly, economic inequities relate to lack of

commitment to address global financial hurdles.

The issues have the solution in the sense that it is impeded trade focus of national laws,

competition, and regulatory practices. Players have the discretion of using data to initiate the

global dialogue that would elaborate interoperability of various regimes. The discussion can

explore the essence of establishing the balance between privacy, benefits, and security offered by

data-enabled trade. Besides, the stakeholders have the opportunity to answer fundamental

questions such as international tax principles, traditional tax concepts, borders that pose

challenges and unconstructive policies that can be resolved via multilateralism approach

(Gurria). Zakaria (66) view that developed economies such as the United States and the

European states should recommit to international mechanisms and institutions by maintaining

constructive relations with every player instead of offsetting initiative of developing economies

serves as better management to the problem.

 Surname 4

Initiative to resolve global economic challenges face challenges such as lack of

commitment from players, income inequality, and diminished global cooperation that thwart the

objectives of the associated nations. These challenges result in adverse outcomes such as

inflation, the decline in living standards, tension, and disruption of international trade.

Nevertheless, the effort can lead to the rise in potential opportunities such as levering from

technological changes and interconnectedness, growth in GDP and coordinated financial system.

Developing nations stand to benefits from improved economic conditions across the world. The

issues relate to the role played by the communication network in addressing world economic

issues. The problem has a formidable solution including adopting multilateralism approach to

discuss policies that impede global trade agreement and commitment to everyone’s’ interest.
 Surname 5

Works Cited

Gurria, Angel. "Challenges for the Global Economy and Possible Responses: Multilateralism

That Delivers - OECD." OECD.org - OECD, 14 May 2018,

www.oecd.org/economy/challenges-for-global-economy-and-possible-responses-

canada-may-2018.htm. Accessed 7 Jan. 2019.

Kissinger, Henry. World Order. Penguin, 2014.

United Nations Department of Economic and Social Affairs. "Boost in Global Economy Offers

Opportunities to Tackle Deep Rooted Development Issues (UN Press Release)." United

Nations Sustainable Development, 22 Apr. 2018,

www.un.org/sustainabledevelopment/blog/2017/12/boost-global-economy-offers-

opportunities-tackle-deep-rooted-development-issues-un-press-release/. Accessed

7 Jan. 2019.

Wharton University of Pennsylvania. "How to Manage the Top Five Global Economic

Challenges." Knowledge@Wharton, 1 Nov. 2017,

knowledge.wharton.upenn.edu/article/what-are-the-top-five-challenges-for-international-

organizations/. Accessed 7 Jan. 2019.

Zakaria, Fareed. The Post-American World: And The Rise Of The Rest. W.W. Norton, 2012.

Zhang, Tao. "Global Economic Challenges and Opportunities." IMF, 25 Sept. 2017,

www.imf.org/en/News/Articles/2017/09/25/sp092517-global-economic-challenges-and-

opportunities. Accessed 7 Jan. 2019.