Friday 25 Sep 2020 | 18:05 | SYDNEY
What's happening on

Global Economy

The ebbs and flows of global economic conditions, trade and capital flows, thus have substantial implications for the Australian economy, and Australia’s major regional trading partners. Understanding the broad trends, and identifying emerging challenges and opportunities within the global economy, is central to the work of the International Economy Program at the Lowy Institute.

The highly integrated nature of the modern global economy became especially evident during the 2008 global financial crisis. What began as a localised problem within the residential asset-backed securities market in the United States, eventually brought down major financial firms across the Western world, and ultimately pushed the United States and Europe into a deep and prolonged recession. Although global economic growth has recovered somewhat since 2008, it is still much lower than pre-2008 trends, and the hangover from the crisis has manifested itself in the form of high unemployment levels throughout much of the developed and developing world, as well as an increasing level of inequality both within and between countries.

Understanding the economic rise of Asia, and particularly of the growing middle class within Asia, is also crucial to the broader work of the Lowy Institute. Political economy analysis on major players in the region, chiefly China, India and Indonesia, features heavily in the work of the East Asia Program and the International Security Program.  

The other income-equality debate

Rock-star economist Thomas Piketty is getting headlines for his book on income distribution,  mainly focused on disparities within advanced economies. This might be the moment to ride the wave of attention and record something of the long-running parallel narrative on emerging economies. If

China to overtake US as world's biggest economy this year

So reports the FT. Now, Interpreter readers have been hearing about China's rise for years, so they might be a bit jaded to such news. But try to shake off your lethargy and breath in the history of these 13 words from the FT's report: The US has been the global leader since overtaking the UK

Economic reform: Can China escape its contradictions?

China has made progress implementing the reform agenda of last November's Third Plenum. Private and foreign investors, especially those in Hong Kong, find themselves at the crux of Beijing's plans for markets to play a 'decisive' role in its statist economy. Two recent reforms are potentially

Movie trailer: Godzilla

A new trailer for the Godzilla reboot has just emerged, and it looks pretty awesome: Judging by the trailer, environmentalists should be ecstatic with this one. In fact, maybe James Cameron and his Hollywood actor pals could have saved themselves the effort of making a worthy documentary about

Inequality in Hong Kong: The divorce factor

Hong Kong is famously unequal. The measured Gini coefficient is among the world's highest. It is praised for 'economic freedom' yet also criticised for 'crony capitalism.'  It's well known in political science that, worldwide, folks care less about wealth inequality per se than lack of opportunity

IPCC and clean energy: Easy on the optimism

The latest Intergovernmental Panel on Climate Change report makes for gloomy reading. The world needs 'drastic changes' to reduce carbon emissions and prevent global temperature rises, reports the ABC; investment in renewable energy needs to triple, says the BBC; the emissions problem is

Think20 2014: Progress report on Australia’s G20 presidency

Leading analysts from influential think tanks from 11 countries across the world provide their interim assessment of the Australian G20 presidency in this report. They all participated in last year’s Think20 meeting in Sydney, organised by the Lowy Institute, and are now discussing whether

The three arrows of Abenomics: A report card

Today the Japanese value-added tax (VAT: what Australians call the GST) rises from 5% to 8%. This seemingly mundane event is a key part of the 'Abenomics' program, the effort to shake Japan out of its decades-long economic lethargy. So how does Abenomics look after 15 months? Exhibit 1 is the

G20: BRICS muscle up over Russia

The good news is that the odds are clearly in favour of the Brisbane G20 Summit going ahead: Sportsbet is offering $1.05 that the Summit will be held and $8.00 that it won't. The bad news is the fact that odds are being offered at all, even if they are long. The question mark that has arisen over

Two recent reports on poverty

First, the Chronic Poverty Report 2014-15, produced by the Chronic Poverty Advisory Network and published by ODI. The report focuses on the policies needed to get to zero extreme poverty. It argues that this is a tripartite challenge: to get close to zero, 'countries need to tackle chronic

Why China is unlikely to have a 'Lehman moment'

Financial markets are worried about the Chinese financial sector, with some even talking about the possibility of a 'Lehman moment', which would set off a major financial meltdown, as occurred in America in 2008. This would be very serious not just for China but for the global economy. China still

G20 2014: perspectives from business, civil society, labour, think tanks and youth

G20 engagement partners from Business (B20), Civil Society (C20), Labour (L20), Think Tanks (T20) and Youth (Y20) have each provided a contribution for this issue of the Monitor. Each address how the groups are organising their contribution to the G20 process in 2014, their priorities for the

Is the IMF a political football in the Ukraine crisis?

The way they were. Yanukovich and Strauss Kahn in 2010. Ukraine faces an economic crisis as well as a political one. Its economy is a mess and it will take a lot of money and time to put it on a sustainable growth path. It may not have enough of either. Caught in the middle is the IMF. The

A union with New Zealand for a larger Australia?

There are various possibilities for a Larger Australia. Michael Fullilove's path is to put more of our national resources into defence and diplomacy, as well as growing our population through increased migration and fertility, creating an Australia which walks taller on the world stage. A very

Mekong: Laos confirms Don Sahong dam plans

The Lao Government confirmed on Wednesday its intention to go ahead with construction of the controversial Don Sahong dam, commencing in December. Lao government ministers said that all of their actions in doing so would be presented in a transparent fashion. As I reported in The Interpreter on

Australia-China trade: Beijing means business

History shows that social unrest and political upheaval have one of two elemental causes: either empty stomachs or full stomachs. Hungry people are angry people, while a well-fed middle class looks beyond basic needs to metaphysical desires, like having a say in government. The central security

Richard Rosecrance on the West's resurgence (part 2)

SR: Given the many political, social, environmental and economic problems China faces, which you list in your previous answer (see Richard Rosecrance interview Part 1), what is the imperative for the grand coalition between the US, Europe and Japan that you argue for in your book? Why is it

Richard Rosecrance on the West's resurgence

Richard Rosecrance, Adjunct Professor at Harvard's John F Kennedy School of Government, is a prominent American thinker on the intersection between economics and international affairs. His latest book is The Resurgence of the West: How a Transatlantic Union can Prevent War and Restore the United

More Trans Pacific Partnership commentary

Further pushback to the Krugman column that Stephen Grenville quoted in his piece on the TPP yesterday. Gideon Rachman shares Grenville's view that Krugman is too busy looking at the economic trees to see the strategic forest. But unlike Grenville, who wants the TPP to embrace China, Rachman

Counterpoint: China and the TPP

Earlier this morning I posted a tweet on the Lowy Institute's account publicising Stephen Grenville's latest piece on the Trans-Pacific Partnership. As you can see below, it brought a response from Patrick Chovanec, chief strategist at Silvercrest Asset Management and a former business professor at

The global outlook for renewable energy

My previous article showed that there has been an unprecedented level of investment in renewable energy over the last decade. Let's consider the drivers for this in more detail and look to the future. Policy measures introduced in Europe and North America kick-started the market for wind turbines

Interview: Danny Russel on the status of the US rebalance

Daniel (Danny) Russel is US Assistant Secretary of State for East Asian and Pacific Affairs, which means he is the State Department's senior Asia diplomat (he succeeded Kurt Campbell in the role). Russel traveled with his boss John Kerry to Jakarta early this week and then made a quick visit to

The Australian economy: How does it compare?

The meeting of the G20 finance ministers and central bank governors in Sydney next weekend provides an excuse to turn the spotlight inwards, towards the domestic economy. The IMF begins its new report on Australia this way: The Australian economy has performed well relative to many other

Adam Minter on the Junkyard Planet (part 4)

Here's part 1 of my interview with author Adam Minter (on the globalisation of the scrap and recycling industry), part 2 on China's role in this industry, and part 3 on India. In this last instalment, I ask Adam about junk and environmentalism: PB: To finish, let's turn to the future. What do you

Adam Minter on the Junkyard Planet (part 3)

Here's part 1 of my interview with author Adam Minter (on the globalisation of the scrap and recycling industry) and part 2 on China's role in this industry. In part 3 we look at India: PB: Your reference to India reminds me of one of the sections in your book that I found most interesting (and

Global cooperation among G20 countries: responding to the crisis and restoring growth

At the outbreak of the global financial crisis, 2008, the G20 was widely acknowledged as helping prevent an even more serious decline in the global economy. It helped to calm the panic in financial markets and articulate a set of possible policy options to restore global stability and growth.

Pages