Competing in a World of Emerged Economies
Competing in a World of Emerged Economies
The Forum was created three years ago, when the State of Florida was invited to the International Economic Forum of the Americas, which also organizes the Conference of Montreal, held annually in June, and the Toronto Global Forum, held annually in October. At that time, we were asked to join Palm Beach County stakeholders in developing a global economic summit addressing the world’s major economic issues so that we could gain a better grasp of them, while providing the participants with a networking opportunity at the same time.
We are living in uncertain times; Europe is experiencing a sovereign debt crisis, and on this side of the Atlantic the recovery is still very fragile. However, from the 2008 collapse of a financial system that was based on government and personal debt, a still-tenuous movement seems to be emerging that will help us achieve a global recovery that will be more fair and sustainable.
Indeed, the world’s leading economic driver, the United States of America, is anticipating growth of between 2.2 and 2.7% in 2012. The outlook for Canada’s growth is slightly lower. As for China, it will remain above the critical threshold of 7.0%, which will allow it to continue in its role as the world’s second-largest economic driver, so long as it can avoid speculative bubbles, especially a real estate bubble, which as we know from experience is particularly risky. Nor would we want to see China get into a dispute with the United States over exchange rates, which would spark a trade war. On the European side, Germany is maintaining a dynamic economy thanks to its strong exports, while 25 European Union countries (save only the United Kingdom and the Czech Republic) have recently signed a new Pact for budget discipline to prevent overspending. As for the Central European Bank, it has recently loaned over $700 billion for three years at a rate of 1.0% to some 800 institutions so they can weather the recession that is plaguing many European countries.
It is reassuring to see that the European Bank is following the example of the U.S. Fed, and is also issuing bonds, as required, to inject money into the financial system to keep the economic wheels turning. We have learned from the mistakes of the 30s, which sent the world into the “Great Depression.” In the present day, instead of the printing press, we rely on the central banks, which, with the aid of computers, can use bond issues to control the flow of cash. The same technique is being used by the Bank of China and the Bank of Japan, thus guaranteeing that there will be no shortage of funds in the international financial system as a whole. However, this method also lets countries manipulate the value of their own currencies, which is less desirable in the potential context of a “currency war.”
This new global economic thrust is very real, but is not yet fully under way. We must consolidate it by avoiding the trap of inflation, and also by steering clear of excessive austerity in the face of the sovereign debt crisis, which would heighten the risk of a recession. Here again, we can look back at the mistakes made in the 30s, so we will not repeat them by blindly and arbitrarily slashing social programs. Government expenditures may need major adjustments, but it is especially the methods that states use that must be revisited.
So, where is the economy headed? What are the dangers associated with a true, lasting economic recovery? Are we recovering, or are we simply surviving? Should we expect another oil crisis? These are all questions that will be at the forefront of our discussions with an outstanding series of economists.
Our participants will receive privileged information concerning the international economy, and the one here, in the USA. Governor Scott will do us the honour of delivering the keynote address at the Conference’s opening luncheon on Monday, April 16.
The summit is a non-profit organization. With everyone’s participation, including that of the Chamber of Commerce, we will make it one of the most important and prestigious world economic forums thanks to the beauty of Palm Beach, and also thanks to Florida’s strategic position, located between North America, Latin America, and Europe. We are also grateful for our exceptional partners, like the Chamber of Commerce.
I hope to have the pleasure of welcoming you on April 16 and 17 at the Palm Beach County Convention Center for the 2nd edition of the Palm Beach Strategic Forum.
President and Chief Executive Officer