Pandemic recovery demands economic intellectualism to embrace futurism as global shifts from ‘knowledge-rich-nations’ to ‘population-rich-nations’ changing economic behavior across the world. How will all this unfold and preparations needed for positive results?
Population Rich Nations: Decades ago, large population in any country was considered an economic curse; sheer burden of visible poverty, scenes of survival and struggle of feeding millions of hungry mouths provided the blatant proof. Today considered a blessing; when citizens armed with mobile online transactional centers are humming and trading with billions of devices now new proofs of economic vibrancy for such overly populated nations.
When already digitally shrunk an accessible world in pockets, the population clusters, creating value and productivity hope with a brighter economic and balanced future. Unlimited, rains of free technologies creating pools of untapped entrepreneurial powers, today, population-rich nations are rapidly gaining smart-power to lead this century.
Knowledge Rich Nations: Over centuries, the supremacy image of knowledge housed in the West, primarily the developed economies now harshly tested as such outdated wealth of knowledge as if water gushing down from broken dams flooding faraway lands across the world. Today, the quality of new global-age knowledge available in remote tribes barely clad natives in rainforests to extremely isolated millions of villages around the world are enough to change the regional and global economic behavior.
Knowledge-rich nations must rapidly re-learn how to compete and survive against highly agile and low-cost brilliance creating shine within some 100 emerging population-rich nations. The monopoly of knowledge has been shattered. Now the time of National Mobilization has arrived to stand up to tidal waves of competitive skills. The Private Sectors of knowledge-rich nations critically need upskilling to forget their past assurances and relearn the future shortcomings to advance with new and better thinking. Collaborative global economic activity is a fine art and understanding global diversity is a new science. Futurism calls knowledge-rich nations for massive upskilling to survive and take notice of such tsunamis. When was the last time such topics debated on the national stage?
Referenced from “15 Monster Trends– by Naseem Javed” Published Dec 2014
The survival of the fittest is the master collaborator: The panicky mentality of always ‘to seek and to destroy’ as a national strategy to economical survival and compete in the global arena has brought us in dust and now Economic Exorcism becomes a possible option. Going forward, open some bold debates and global cooperation across dozens of nations, as this is where the future prosperity is hidden. The current upside down pandemic recovery world offers the best and opportune time to recreate new vision and start collaborative processes on a fast track.
Empty Minds Wanted: To fill up fresh water you need empty buckets but not overly filled garbage cans.To fill brand new innovative ideas and to apply critical thinking you must prove vast empty spaces in your mind so the cathedrals of knowledge will rise to allow new wisdom fly freely to new heights. When capabilities to face the truth becomes a prerequisite then applying critical thinking and complex problem solving becomes a fine art. Extraordinary mental spaces needed and mental stamina required.
The Upcoming Tsunamis; the new opportunities
Entrepreneurial March: Across the world mostly in Asia, some Billion new entrepreneurs are on the march. In perspective, some 100,000 entrepreneurs secured the supremacy of America for over a century. Ministries of Trade and Economic Development Bodies of the world and Immigration Control Agencies need special skills and blueprints on how to create large-scale special Visa programs to attract and allow such forces to energize their own economies. Prerequisites are finding out on why Western education and government programs failed to create new armies of entrepreneurs. Why such ideas considered, a forbidden path, controlled by a trail of silence?
Why not create a 10-year tax-free plan for all SME under USD$10 Million in turnover. Create and attract new armies of entrepreneurs. They become the fastest machines for new job creation. Eliminate all fees and unnecessary paperwork, make telecommunication and exportability costs subsidized, but let them grow, even charge them all this in taxes but much later… current knowledge base demonstrated by National Ministries of such departments critically missing special skills and deployment blueprints.
SME Expansion: The pandemic recovery will witness shut down of 50% business for various reasons, but also a 100% rise in new small medium ventures based on new business and remote models as the majority of nations will lose sectors of economy and establishments while job scarcity will move working citizens towards self-employment and entrepreneurial activities.
Remote Smartness: The business world has suddenly acquired brand new respect of receiving high quality ‘smartness’ delivered via remote working channels. As economically viable working models, the globally framed smartness on the go via remote channels is a new pandemic phenomenon helping businesses to achieve superb productivity.
Talent is not local but across the nation, continent and the world. Sleeping giants will emerge. No longer confined to their local mandates, remote smartness will crisscross the world between coffee and lunch-breaks. Leadership must acquire special understanding of such working models. With seasoned layers of upskilling, such a system will shine.
Free Fast Track Commercialization: Entrepreneurialism is uniquely about speedy execution, delivery and commercialization, now with millions of options and unlimited markets, nation-by nation a new thinking emerging, new blood flowing in commercial veins to make costs insignificant when applied to returns. This is global-age deployment. Making sluggish and super expensive commercialization of innovation a hard process now agile and floating in almost free accessibility.
The Summary: Forbidden are the debates and discussions on such topics amongst nations, sector-by-sector or association by association, the trade groups caught in digital or mental-divides and missing out tempo. Fears of facing truth, admitting missing the boats or unable to demonstrate skills on digitization a freeze of action support their silence. There are hot spots; there are great open-minded teams. Nevertheless, new leaderships aggressively seeking answers are opening new passages during pandemic recovery. The majority of economies across the world are already on the precipice, the economic recovery is a long path and critically in need of dramatic actions and revolutionary executions, so what are the missing links and who is ready start some action? Time to layout some blueprints.
The rest is easy.
Price hike in Pakistan: the worst of all worries
The most serious issue Pakistan’s economy is currently dealing with is price increases or inflation. Life has become miserable for the average person as a result of the ongoing increase in the cost of necessities like food, fuel, and medicine. The general public’s standard of living is not the only thing this phenomenon is affecting; it is also fueling social unrest across the nation.
There are numerous factors contributing to the price increase. The rise in the price of oil on the global market comes first. Pakistan relies heavily on imported oil, and when the price of crude oil increases globally, it has a negative impact on the regional economy. The issue has also been exacerbated by Pakistan’s struggling economy, high-interest rates, and currency devaluation.
However, several causes can be identified for Pakistan’s dollar exchange rate’s ongoing rise. One of the main causes is the nation’s substantial import bill, which raises the demand for dollars. Energy and other necessities must be imported into Pakistan, and the pressure on its foreign exchange reserves is increased by the high demand for dollars to pay for these imports. Further weakening Pakistan’s currency is the fact that its exports have not been able to keep up with its imports, resulting in a trade deficit. Due to investors’ reluctance to invest in a nation with an unstable economy, political unrest, and economic ambiguity have also boosted the dollar rate.
Similarly, the debt incurred by Pakistan is a sizable additional factor in raising the dollar rate in that country. Pakistan has one of the highest debt-to-GDP ratios in the world and has borrowed a significant amount of money from international financial institutions to meet its financial needs. The pressure from this borrowing has reduced the nation’s foreign exchange reserves and devalued its currency. The country’s economy has been severely impacted by the COVID-19 pandemic, necessitating a significant fiscal stimulus on the part of the government. This has further aggravated the situation. In Pakistan, the dollar rate has been rising steadily as a result of all these factors working together.
Simultaneously, inflation and price increases affect Pakistan’s politics as well as its economy. The opposition parties are using the government’s inability to control the price increase as a major issue to attack it and win over the public. The opposition parties are protesting and demonstrating against the government, accusing it of being responsible for the price increase. They contend that the general populace is suffering because the government’s policies have failed to control inflation. The price increase controversy is being manipulated by the opposition to advance their own political goals and turn the public against the ruling party.
The government, on the other hand, is making an effort to address the issue by implementing a variety of measures, including raising subsidies for necessities and lowering import taxes. However, the opposition parties are utilizing this failure to their advantage because these measures have failed to contain inflation. Similarly, the price increase has important political repercussions. Public support for the opposition parties is growing, while support for the government is eroding. If the government is unable to control the price increase, it may trigger more political unrest, demonstrations, and even violence.
Therefore, a price increase has far-reaching effects. The groups with lower incomes are most negatively impacted because they cannot afford the necessities of life. They are compelled to reduce their food intake as well as their health and education spending. The middle class is also suffering. After all, they must second-guess any major purchases because their purchasing power has significantly dropped.
In addition to economic issues, the price increase is also creating social ones. As they struggle to meet their basic needs, people are growing agitated and desperate. Riots, demonstrations, and protests against the government are being sparked by this annoyance. As people struggle more to make ends meet, inflation also causes a rise in the crime rate.
The government must act swiftly and effectively to stop the price increase. Controlling the hoarding and smuggling of essential commodities is the first step. Second, to lessen their reliance on imports, they must make investments in regional industries. Additionally, the government should prioritize economic expansion because it can result in more job opportunities and, ultimately, greater purchasing power for the average citizen.
The government needs to pay attention to it right away and take action. The stability of the nation’s social and economic systems is in jeopardy, and if the issue is not quickly resolved, it might fuel more unrest and instability. This issue requires both political and economic solutions. The public must see that the government is acting practically to control inflation by effectively communicating its policies to them. Furthermore, the opposition parties should cooperate with the government to find a solution rather than use the price increase issue for political purposes.
To address the issue, the government must take a comprehensive approach that includes both immediate and long-term actions. The private sector and civil society can both be crucial players in finding solutions to the issue. The only way the nation can hope to overcome the problem of price increases and guarantee a higher standard of living for its citizens is through collective effort.
The opposition parties should work with the government to find a solution to this issue, as the government must act quickly and effectively to control inflation. The common people’s lives are being impacted by the price increase, and resolving it will require a collaborative effort from all parties involved. The federal government ought to prioritize long-term economic plans that can boost employment opportunities, reduce reliance on imports, and promote sustainable economic growth. To encourage trade and commerce, the government ought to work on enhancing the infrastructure, such as the roads and communication systems.
Additionally, the government needs to take strict action against anyone hoarding, smuggling, or profiting from the situation in order to make extra money. In order to boost production and lessen reliance on imports, the government should also support local industries by offering incentives and support.
Vietnam’s macroeconomic policy and post COVID recovery
As per the latest IMF reports real Gross Domestic Product(GDP) of Vietnam in 2023 is estimated at 6.2 percent. This clearly shows that Vietnam has been avoiding the usual recessionary trends across the Asian markets and is showing better than average growth .With inflation rate being less than 4 per cent, it clearly shows that Vietnam is likely to emerge as a promising economy in Asia. According to the regional economic outlook which has been released by the IMF , it clearly projects that there are high expectations of uncharacteristic slow down in China benefitting competitors such as Vietnam, Philippines and Indonesia .
Asian Development Bank(ADB) has forecasted that Vietnam’s GDP was expected to grow by 6.5% in 2022 and nearly 6.7% forecasted for the year 2023. If one looks into the comparative forecast for countries in Southeast Asia it is stated that Philippines will grow by 6.3 per cent ,Cambodia 6.2 per cent ,Indonesia 5 per cent, Thailand 4.2 per cent , Laos 3.5 per cent ,and so on. If one looks into the core fundamentals of Vietnam following the COVID-19 pandemic, it has been clearly stated that Vietnam’s annual economic growth rate hovered between 6.3 per cent to 6.5 per cent for the decade preceding the current one.
One of the major aspects of this better than average economic growth was high foreign direct investment, increased domestic consumption, sizeable increase in the middle class, and Vietnam’s focus on promoting its manufacturing to be export oriented. In terms of other critical aspects Vietnam has been securing loans from many other international agencies over the past few years. With funding and grants from different international economic agencies ,Vietnam has been able to upgrade its road, rail transport and border connectivity infrastructure along with promoting social economic growth of nearly 243,000 people across the provinces.
One of the mainstays of Vietnam economy has been small and medium enterprises along with active participation of women.These enterprises have been getting bank credit and technical assistance through different initiatives such as public private partnerships, promotion of private sector development, and extensive reforms in state owned enterprises. Vietnam has been preparing well for facing the severity of climate change and also undertaking pilot projects for post disaster reconstruction and rehabilitation. It has institutional arrangements with World bank and Netherlands to develop resilience for the coastal areas particularly Mekong delta to undertake comprehensive efforts in mitigating the climate change effects.
Over a period of time Vietnam has been making serious efforts in emerging as a knowledge network society. This includes improving policy applications, enhancing capacities of stakeholders and providing information to the communities on a regular basis. Vietnam has also received more than USD $ 2 million grant for climate resilient inclusive infrastructure through high technology fund from ADB. In terms of meeting UN sustainable development goals, Vietnam has successfully provided electricity to its cent percent population.
It has been stated that Vietnam is one of the economies which is going to benefit from Regional Comprehensive Economic Partnership(RCEP) given the reduction in tariffs during the period 2020 to 2035 and because of these reductions the export of electrical equipment and machinery from Vietnam is going to grow to the level of 12.1% while the main stay of its exports primarily textiles and apparels are going to grow by nearly 10%. Given the fact that RCEP would facilitate Vietnam’s entry into high end markets such as Japan, Australia and New Zealand might translate into better trade revenues.
In fact better integration with regional economies would promote its sectors such as tourism, entertainment, education, agriculture, automobile telecommunication, and IT. Two different aspects have gained international attention because of Vietnam ranked 70th out of 190 countries in terms of ease of doing business, and its major strength has been the young population as nearly 70 per cent of its population is aged between 15 to 64. This large working population reduces social security liabilities to the aging population. Major work which has been done by the current Vietnamese government is its national strategy for Environmental Protection 2030 with a comprehensive plan under Vision 2050.
It is expected that Vietnam’s construction sector is going to grow because of increase spending on infrastructure projects along with improvement in regional connectivity through rail, road, and air transport infrastructure. There are high expectations that Vietnam tourism sector will post impressive recovery, and last year the country witnessed an increase of tourist arrivals by more than 185 per cent in the first four months of 2022. The tourism sector is going to increase further given the fact that Vietnam has signed a comprehensive agreement in boosting sustainable tourism and post COVID recovery at the national level. During the period 2022 to 2025 it is expected that the cumulative average growth rate of tourism would be 13.5% average each year .
As per the global data set and the General Statistical Office of Vietnam, the industrial production is also going to increase substantially and export orders as well as internal domestic demand is going to bring about remarkable improvement in production as well as exports. Last year, the G7 countries have agreed to grant a loan of US $5.5 billion for helping Vietnam transition from coal to other sources for power generation. This was based on the promise that Vietnam should make plans for shifting to nearly 50 per cent of its power requirements from renewable energy by the year 2030. It is also expected that foreign direct investment in Vietnam is going to be steady with high tech industries, knowledge based service industries, and education gaining the maximum investments. The real estate and construction sector are other sectors which are going to gain international attention.
This year it is expected that public investment would be helpful in post pandemic recovery and under the Socio Economic Recovery and Development Programme nearly US $15.4 billion has been approved for accelerating the economic growth. Furthermore, commodity exports is likely to see a remarkable two digit jump and the FTAs that Vietnam has signed with various partners will help in building the capacities of Vietnamese manufacturing sector in product transformation, exploring diversified markets, better restructuring, and skill development at different levels. The transformation is also happening in terms of fiscal and monetary prudence as well as undertaking reforms within banking system and financial governance. The anti corruption drive that the Vietnam has undertaken in the last few years have built the investor confidence and it is expected that Vietnam will reap the dividends of better business environment, market connectivity, and relatively comparative advantage among other competitors in Southeast Asia. As expected the fundamentals are getting stronger, and therefore Vietnam can witness a stronger economic growth and better macroeconomic stability in the year 2023.
Azerbaijan’s Favorable Climate for Foreign Investments
Azerbaijan, situated at the crossroads of Europe and Asia, presents investors with plentiful opportunities, chiefly in the area of oil and gas, tourism, and agriculture, as well as policies developed to stimulate foreign investment and enhance the investment environment. Furthermore, Azerbaijan invested in order to gain access to additional markets and strengthen its presence in the international economy, and the country has committed capital to sectors such as energy, real estate, infrastructure, and tourism.
Azerbaijan’s economy has seen an impressive rate of growth over the past decade. According to the World Bank, the country’s Gross Domestic Product (GDP) increased by 1.4% in 2020, despite the global pandemic. This serves as a testament to the fortitude of Azerbaijan’s economy, which has endured multiple economic disturbances in the past. Estimations suggest that Azerbaijan’s Gross Domestic Product is approximately $54 billion, with an average annual increase of 1.9% over the past four years. Azerbaijan has experienced a steady low rate of unemployment over the past decade, with an average of 5%, indicating a strong labor market and a prosperous business environment.
Azerbaijan has cultivated wise investments in fields that demonstrate promising growth and profitability. The efforts of the nation to broaden its economic base have proven successful, resulting in a decrease in its reliance on petroleum. Azerbaijan has achieved notable success in diversifying its economic base and diminishing its dependence on oil exports. The non-oil exports of Azerbaijan have been rising continuously in the recent years; as reported by the Azerbaijan Export and Investment Promotion Agency (AZPROMO), there was a 47.2% ($2713.40 million) and 12.3% ($3047.67 million) increase in 2021 and 2022 respectively. Between January and February of 2023, the country recorded an increase of 36.6% in non-oil export earnings, amounting to approximately $651.42 million, compared to the same period the year before.
Multinational corporations from around the world are highly eager to access Azerbaijan’s natural resources, mainly its oil and gas reserves. In 2020, Azerbaijan’s oil production reached 33.5 million tons, followed by 29.5 million tons and 32.8 million tons in 2021 and 2022 respectively, as reported by the State Oil Company of the Republic of Azerbaijan (SOCAR), thus placing the nation among the major oil-producing countries in the region. Oil production is projected to reach 35 million barrels in 2023. According to the Oil and Gas Journal, Azerbaijan has more than 2 trillion cubic meters of natural gas reserves, representing a significant opportunity for energy companies worldwide.
In 2020, Azerbaijan attracted a total of $4.5 billion in foreign direct investment (FDI):
Azerbaijan saw a 5.9% increase in Foreign Direct Investment (FDI) compared to the past year, which made it one of the most prominent FDI recipients within the Commonwealth of Independent States (CIS) area. In 2020, the United Kingdom, Turkey and the United States were the top three countries by FDI in Azerbaijan, with the United Kingdom contributing $1.7 billion, Turkey investing $577 million and the United States investing $475 million, according to the Central Bank of Azerbaijan.
Furthermore, the Sustainable Development Goals (SDG) Index reveals that Azerbaijan has made substantial strides in reaching the objectives that were put in place by the United Nations across multiple domains. According to the SDG Index, the rate of global poverty has decreased from 49.6% in 2010 to 5.9% by 2022. Azerbaijan’s Global Hunger Index (GHI) has seen a positive trend, decreasing from 14.5 in 2010 to 9.7 in 2019 and further to 7.5 in 2022. The citizens of the country have reaped the benefits of its efforts to bolster health and well-being, as evident by the increase in life expectancy from 68.6 years in 2010 to 73.3 years in 2022. Azerbaijan’s commitment to improving the standard of living for its people and promoting economic growth in a sustainable manner are reflective of its commitment to the achievement of the Sustainable Development Goals.
In 2019, Azerbaijan achieved a ranking of 25th place in the World Bank’s Ease of Doing Business report, which marks a notable enhancement of 32 places from the previous year and highlights a favorable business climate for foreign investors. In 2020, the World Bank’s Ease of Doing Business Report ranked Azerbaijan 34th among 190 countries, with a score of 76.7 for the ease of setting up a business.
Taking all factors into consideration, Azerbaijan is a highly attractive investment opportunity for a variety of industries, including energy, tourism, agriculture, and technology. In order to stimulate foreign investment, the government has put in place a variety of incentives to simplify the foreign investment process. Azerbaijan is an attractive option for investors to expand their investment portfolios and explore new markets due to its attractive business environment, strategic location, and robust economic growth. Moreover, Azerbaijan’s foreign investments have had a considerable influence on the nation’s economic growth. The country has leveraged investments to expand its portfolio and reduce its reliance on oil and gas industries, as well as to access novel markets.
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