Analysing the risk of world economy

Prof Cheng presenting a token of appreciation to Dr Tanweer (left)

The Institute of Management and Leadership Development (IMLD) held a talk on “The Prospect and the Risks for the World Economy in 2019 and beyond” at Sungai long Campus on 13 February 2019. Present at the talk were Thrivent Financial Global Public Policy and Economics Director Dr Tanweer Akram, IMLD Director Prof Dr Cheng Ming Yu, students and staff.

The global economy is projected to continue to expand at a moderate pace in 2019 though below the pace prior to the Global Financial Crisis. The paper examines the continued divergence in the performances of the major advanced economies and the key emerging markets and the challenges ahead for the United States and other major economies.

In the talk, Dr Tanweer spoke about the equity upswings in major financial markets, volatility in financial markets, the twin engines of global economic growth, global industrial production, the recovery of residential real estate prices as well as the median income growth rate leading to the alleviation of inequality.

He explained the limitations of China and said, “The demographics of China are rapidly ageing with a low fertility rate and imbalanced male-female ratio. As for the economic landscape, there are limited agricultural land, rising inequality of income and wealth, restriction of capital flow due to closed financial markets, the results of ‘One Belt, One Road’ initiatives are uncertain and a large share of state-directed and state-controlled enterprises as well as rampant corruption and nepotism.”

He said, “There is a risk to the world economy such as climate change, Internet of Things, artificial intelligence, big data and so forth. In order to achieve a sustainable development, Malaysia needs to have a more skilled workforce, thus education is important and it has to start at an early age.” He added, “Climate change such as the rising of sea levels, acidifying oceans, melting of polar caps, change of bird migration patterns, volatility of weather patterns will affect the world economy as well.

Thrivent, a Fortune 500 company, manages more than $136billion dollars in assets and offers a wide range of financial product and services to over two million members throughout the United States. He develops the firm’s global macroeconomic outlook and identifies the risks to the global economy. He is also responsible for developing the firm’s views on international regulatory issues related to the financial services industry, particularly on those topics that pertain to the mutual and cooperative insurance industry.