Prof. Dr. Aman Agarwal, a world-renowned expert in Economics, Senior Vice Chairman, and Dean at the Indian Institute of Finance participated in Risk Roundup to discuss the Emerging Economic Crisis.
Emerging Economic Crisis
Many countries’ economies have been facing turmoil since the onset of the COVID 19 pandemic. From on and off lockdowns and resulting supply chain disruptions, the reality of the volatile situation has led us to the edge of a looming economic crisis. It has been aggravated further by the Russia-Ukraine war and the rapidly escalating emerging technologies’ geopolitical powerplay. As a result, many countries are on their way to facing an economic crisis that would likely result in profound political and societal instability.
The emerging economic crisis and the imminent collapse of many countries have global implications not only because of destabilization of the countries and potential mass migration of its citizens but also because the future of humanity will be at risk.
The Global Economic Growth Gloom
The global economic growth gloom is proliferating beyond 2022. To add to the woe, inflation remains unusually high across most countries. Surprisingly, both developed and developing economies are feeling the heat.
For instance, according to the data publicly available,
- US inflation: is at 9.1 percent
- Britain’s inflation: is at 9.1 percent
- Germany’s inflation: is at 8.7 percent
- India’s inflation: is at 7.04 percent
- Pakistan’s inflation: is at 13.8 percent
- Sri Lanka’s inflation: is at 39.1 percent
- Iran’s inflation: is at 52.5%
- Argentina’s inflation: is at 60%
- Turkey’s inflation: is at 78.62
- Lebanon’s inflation: is at 211%
So, the question is that while developed economies have the resources to weather the impact of the growing inflation, how are emerging economies struggling with the ever-increasing inflation? It is becoming evident that many economies face simultaneous blows from all directions. As seen, many countries are experiencing stagnant or slow growth. They are also experiencing high inflation (referred to as stagflation–a situation where prices keep rising while economic growth slumps). Moreover, the currencies are depreciating, and the exchange value of a country’s currency against the other currencies in a floating rate system is rapidly declining. It is crucial to understand that supply shock, poor fiscal and monetary policies, and high unemployment play a critical role in stagflation. As a result, the fear of stagflation is growing. The question is, where will the stagflation take the countries and the global economy.
The concerns are growing that as economies slow down, the overall disposable income negatively impacts most households. But, at the same time, everyone (individuals and institutions) still has to spend more on the same products and services because of the soaring prices. So, not only the consumers’ spending but businesses’ spending also understandably slow down to adjust to their income. Moreover, when consumers buy fewer things, revenue also declines for companies. Besides, investment decisions are usually halted at all levels during an uncertain period. So, the question is, what should countries do to combat the coming stagflation.
The Complex Challenges
Economic progress has not come equally to many countries so far. Amid the lack of sustainable economic security that can hold all citizens and governments together, the reality is that the decision-makers are unable to unify against the common threats facing countries. As a result, most citizens in the collapsing countries fear they have no hope but to flee the country. The reality is that:
- Inflation is increasing
- The currencies are collapsing
- Investments have slowed down
- Unemployment is rising
- The food crisis is also emerging
Millions of people across many countries are on the brink of famine as food, fuel, and fertilizer costs have increased. No nation will be immune to such a catastrophe’s social and economic repercussions from the coming global food shortage. Amid growing challenges, countries are reverting to the controls of the past. Citizens are not convinced about their future, as shown by their forward-looking national governments. As a result, societal collapse is emerging with the economic collapse we witness in Sri Lanka and many other nations.
Understanding emerging economic crises is an opportunity to question the ongoing hybrid warfare worldwide and whether the power play behind the geopolitics of emerging technologies will bring down our civilization. Now is the time to discuss the implications of the emerging economic crisis to safeguard our individual and collective future!
For more, please watch the Risk Roundup Webcast or hear the Risk Roundup Podcast
About the Guest
Prof. Aman Aggarwal is a renowned Economist and a Senior Vice-Chairman at the Indian Institute of Finance.
About the Host of Risk Roundup
Jayshree Pandya (née Bhatt) is a leading expert at the intersection of science, technology, & security. She is a globally recognized futurist passionate about protecting the Future of Humanity. She serves in the C-Suite of leading emerging technology startups, actively applying her scientific background to designing systems. She has a Ph.D. in Microbiology for her 1986-1991 work on Hydrogen Production by Halobacterium halobium, for which she was also awarded a National Young Scientist Award in Biochemistry in 1988-89. In addition, she has done two postdoctoral fellowships, one at the University of Hawaii and another at the University of Chicago. She also did her Executive Education Program in Operations and Change Management at Rice University – Jesse H. Jones Graduate School of Management in 2000 – 2001. She founded Risk Group LLC in 2002, which evolved into a Strategic Security Risk Research Organization, Platform, and Community in 2015. She is also the host of the influential Risk Roundup Podcast on a mission to talk to a million decision-makers. She has already conducted more than 260 one-to-one interviews with top decision-makers worldwide. She is now leading the global discussions on emerging technologies, technology transformation, and nation preparedness.
Her scientific research has contributed to more than 30 peer-reviewed articles in top international journals. Moreover, her research across many other domains has contributed to more than 100 publications and is pursued to provide strategic security solutions. She wrote for Forbes in 2019-2020 and now writes regularly for Risk Group. In addition, she has published three Strategic Security Risk Reports and three books, The Global Age, The Quantum Threat, and Geopolitics of Cybersecurity. She is an invited speaker on emerging technologies, technology transformation, digital disruption, and strategic security risks from the National Science Foundation to leading organizations in the United States, Europe, and Asia. She can be reached at + (832) 971 8322 and followed on Twitter @jayshreepandya and LinkedIn @drjayshreepandya.
About Risk Roundup
Risk Roundup, a global initiative launched by Risk Group, is a security risk reporting for risks emerging from existing and emerging technologies, technology convergence, and transformation happening across cyberspace, aquaspace, geospace, and space. Risk Roundup is released in audio (Podcast) and video (Webcast) formats. It is available for subscription on the Risk Group Website, iTunes, Google Play, Stitcher Radio, Android, and Risk Group Professional Social Media.
About Risk Group
Risk Group is a Strategic Security Risk Research Platform and Community. Risk Group’s Strategic Security Community and Ecosystem is the first and only cross-disciplinary and collective community that is made of top scientists, security professionals, thought leaders, entrepreneurs, philanthropists, policymakers, and academic institutions from across nations collaborating to research, review, rate, and report strategic security risks to protect the future of humanity.
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