Global Trends by Martin Khor
Monday 29 December 2009
2008 ends with new Palestinian plight
As the year ends,
the world is reminded again of the plight of Palestinians, now under
a new bombardment by
For Palestinians and for all who care for them around the world, the year 2009 is ending in a terrible way, even by the standards of the suffering endured by this most suppressed of people.
The Israeli air
strikes onto the small and highly populated Gaza Strip have killed 230
people by Sunday morning Malaysian time and injured hundreds more, and
this may only be the start, as
The television footage of scores of bodies lying dead on the ground, and many more injured and bloodied people being carried onto trucks or in small medical vans gave concrete backing to the condemnations by many around the world, that this was gross aggression, a massacre.
says that their big military move is to protect its citizens from rocket
However, the actions
of an occupied people in resistance mode cannot be put on par with the
heightened aggression of an occupying force. And the application of
high-powered weapons launched from modern aircraft and navy ships, aimed
at many places in
It is a repeat of
the Israeli mass bombing of
The hospital system was already on the brink of collapse, with medical supplies running out, when it was placed under greater stress by the bombings starting last Saturday.
As the year ends,
questions crying to be answered include whether
Or whether the “international
community” will finally decide to act and let
The world wonders
whether a new
It looks as though
things will get even worse for
This prediction, not so difficult to make, applies also to the global economy in 2009. In 2008, the near collapse of the Western financial system was the most significant global event.
In the last quarter
of 2008, the drama-filled financial crisis (affecting financial institutions)
was transformed into a “real economy” crisis, characterized by losses
of industrial companies (such as the near bankruptcies of the Detroit
car makers), falling consumer demand and rising job losses, and culminating
in declines in the
In developing countries
Grim though the situation already is, 2009 will see worse times as the real-economy recession is only at its starting point. There will be deeper cuts in consumer spending and business investments, more profit and job losses in the developed economies, and these will translate into yet lower demand for developing countries’ exports.
These emergency measures will to some extent alleviate the recessionary tendencies. But by how much, and when will they take effect? Will there also be adverse side effects, such as the ballooning of government deficits, and inflation, which will limit the extent to which the medicines can be applied?
These will be among the big issues of 2009. For developing countries like Malaysia, it is important not only to come up with short term strategies to counter the imported recession (using these Keynesian policy tools, as Malaysia did during the Asian crisis a decade ago) but also to review the export-led and foreign investment-led economic model.
This model may have been suitable in an environment of rapid global economic growth, but may be a source of weakness if the global economy remains in a weakened state for many years.
There is already
a debate in