Question

Q1. Will the Globalization will be affected in a negative way(reducing than now) when there is a current situation like

(1) Corona virus pandemic(2020)

(2) World financial crisis(2007-2008)

why these current situation may affect on the globalization?

Answer 1

1l. Yes, the globalization will be negatively affected due to the corona virus pandemic. Several industries had been adversely affected due to the outbreak of covid -19 globally. News reports are beating several reports of the number of supply chains that are affected. It is evident that the global economy is grinding to a halt.

If the virus remains in the world for a long time, the analysts fears that the global economy may slip into a recession. As nobody is able to predict the endurance of the virus. The IMF has predicted that the global GDP is estimated as 1.6% in 2020 while it was 2.9% in 2019.

The United nations conference on the trade and development cell has said that the outbreak could cost the global economy up to 2-trillion dollars this year. Recession due to the pandemic in some countries will bring down the global economic growth to clock in below 2.5%. Inorder to due with the effects of the pandemic, OPEC hsa proposed to curb oil output. The price of oil has falken by about a quarter and the demand for fuel is also expected to falk down.

Businesses are now facing the challenge of disrupted supply of components toake their products. They have to take into account the large number of quarantined work force and factories that are temporarily shut.

When chinese supplies were shut down, the indian pharmaceutical, automobile and mobile phone industries were highly affected. The pesticides sectors were also been affected as the manufacturers had been depend on china.

There has been an impact on the sports, entertainment, and tourism sectors as well. Olympics and indian premier league were postponed. on the other hand the demand for medicines, soaps and hand sanitizers were highly increased.

2). The world financial crisis (2007-2008) is the most worst financial crisis among the world because it totally breaks the whole business industry government financial commitments and a major loss in the economy. The confidence of business man and consumers had worstly affected. The spending has been cut down by the households. It declined the production in global industries and a major decrease in the GDP of the most economies.

Many of the reports suggested that the economy will tend to the worst conditions if the problem continues. The analysts fears of collapse of the global economy. The savings and loans in the banks got melt down due to the crisis. Thus the crisis affected the financial and banking sector in a high worst manner.

The government took strategic policies to save the borrowers by reducing the rate of interests. The world central bank also cutted the rate of interests. The lending of banks in the cross borders were reduced. The banks situated in OECD nations lowered their deals with the foreign countries from the rising markets.

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