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Global Recession: A Small Study

The document discusses the global recession that occurred from 2008 to 2009. It notes that the IMF defines a global recession as global economic growth of 3% or less. Germany, Eurozone countries, Japan, and the US all experienced negative GDP growth in late 2008, qualifying as a recession. The recession negatively impacted India due to its economic ties with the US and declining profits for Indian companies with major outsourcing deals in the US. While a global recession in 2009 was possible, leading economic indicators now suggest the recession is ending and recovery is underway, led by improving conditions in China and India.

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73 views

Global Recession: A Small Study

The document discusses the global recession that occurred from 2008 to 2009. It notes that the IMF defines a global recession as global economic growth of 3% or less. Germany, Eurozone countries, Japan, and the US all experienced negative GDP growth in late 2008, qualifying as a recession. The recession negatively impacted India due to its economic ties with the US and declining profits for Indian companies with major outsourcing deals in the US. While a global recession in 2009 was possible, leading economic indicators now suggest the recession is ending and recovery is underway, led by improving conditions in China and India.

Uploaded by

KIRAN GOPAL
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPT, PDF, TXT or read online on Scribd
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GLOBAL RECESSION

A SMALL STUDY
 A global recession is a period of global economic
slowdown.

The INTER NATIONAL MONITORY


FUND(IMF) takes many factors into account when
defining a global recession, but it states that global
economic growth of 3 percent or less is "equivalent
to a global recession".

According to IMF three periods since 1985 qualify:


1990-1993, 1998 and 2001-2002.
Germany, Europe's largest economy, contracted
by 0.5 percent in the third quarter of 2008, putting
it in recession for the first time in five years.

The Eurozone economy. made up of the 15


countries that use the eurocontracted by 0.2% in
the third quarter of 2008 following a 0.2% fall in
GDP in the second quarter.
IMPACT ON INDIA

• A SLOW DOWN IN THE US ECONOMY IS A


BAD NEWS FOR INDIA
• INDIAN COMPANIES HAVE MAJOR OUT
SOURCING DEALS FROM US
• INDAI’S EXPORTS TO THE US HAVE ALSO
GROWN SUBSTATIALLY OVER THE YEARS
• INDIAN COMPANIES WITH BIG TICKETS DEALS
IN THE US ARE SEEING THEIR PROFIT
MARGINS SHRINKING
Japan's GDP contracted at an annual
rate of 0.4 percent from July to September
2008, marking the second consecutive
quarter of negative growth. Japan's
previous recession was in 2001, after the
burst in the United States.
In USA, GDP dropped 0.5% drop in the
third quarter of 2008. A number of
economists surveyed by Wall Street
Journal expect gross domestic product to
decline at an annualized rate of 3% in this
year's fourth quarter and 1.5% in the
following quarter.
Possibility of a global recession
in 2009
According to the IMF’s World Economic
Outlook, October 8, 2008, the world
economy is “entering a major downturn”
in the face of “the most dangerous shock”
to rich-country financial markets since
the 1930s. an 2009:

The IMF updated their forecast of global


GDP growth in 2009 from over to 2%
Global recession coming to an
end
 Leading indicators suggest that the global
recession is coming to an end and the world
economy is on the road to a policy-induced
recovery, a senior economist of the Moody's
Economy. COM said in a latest report.
"The OECD's composite leading
indicators signal that the worst is over,"
Significant improvement in the world
economic map in July, as compared with that in
January.

 But Japan remains in the slowdown phase,


still troubled with high unemployment and
massive overcapacity in manufacturing.
    In Asia, China and India are
again picking up growth momentum
and are the first to recover from the
impacts of the global financial turmoil
and economic slowdown. Indonesia
and Bangladesh are still members of
the expanding growth club.
Ample liquidity provided by
central banks has helped stabilize
the financial markets and credit
conditions
 The OECD's composite leading
indicators signal that the worst is
over
SO WE CAN HOPE THAT
THE WORST IS OVER AND
THE FUTURE WILL BE THE
DAYS OF CULTIVATION
THANKYOU

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