What does 2016 hold for the global economy?
The global economy is poised for economic growth comparable to recent years’ performance, but with a somewhat different texture. The most important influence on our global economy will probably continue to be the price of energy. Two consequences follow from continued low energy costs:
First, across pretty much all of the developed world the rate of inflation is set to rise from the near-zero rates that have prevailed recently
Second, whereas last year, we saw the predominance of the negative effects of low energy prices over the positive ones, this year that balance should be on the reverse side.
The global economy’s medium-term growth prospects have weakened as well, because potential growth is being held back by low productivity, aging populations, and the legacies of the global financial crisis. High debt, low investment, and weak banks continue to burdensome advanced economies, especially in Europe; and many emerging economies continue to face adjustments after their post-crisis credit and investment boom.
In the US, unemployment is down and consumer confidence is growing, so we should expect Janet Yellen at the Federal Reserve to continue efforts to nudge interest rates higher, as the country continues its recovery from the financial crisis. Russia and Brazil are already in recession and a further slowdown in China could hit the less developed world hard.
The Mauritian authorities however expect for a growth of 5.3% of the economy in 2016 compared to 3.5% recorded last year. And this growth should be about 5.7% for the 2016-2017 periods and bring the Mauritian economy a comparable growth than that before the global financial crisis. The global economy is expecting a major growth this year from the BPO market. According to a survey carried out by the Information, communication and telecommunication (ICT) sector, the BPO market is to grow at 5.9% which will prove to be beneficial for companies operating in this sector.
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