Monday, July 29, 2013

Changes in the international economy. 2013 Perspectives from UNCTAD's World Investment Report 2013)

By: Carolina Herrera Cano* ( )
International Business student, Universidad EAFIT, Colombia

The differences between the way in which the international economy works nowadays, and how it seemed to work few years ago, creates a scenario in which it is possible to think about the actual cyclical process of the macroeconomic indexes.  In this way, the coexistence of contraction in the FDI flows in developed countries, and its expansion in developing and transition economies should not be surprising. But the current dynamics should be analyzed in a deeper way: the improvements in the transition and developing countries exist maybe just because of its comparison with what it is happening in the rest of the world.
UNCTAD's WIR 2013, highlights some problems that keep on surviving in the less developed countries, and are also appearing in developed countries like the levels of unemployment, and the stagnation in the value added. What I would like to mention after this hypothesis is: the weak conditions that emerged after the global economic crisis are not just part of the “recession stage” of some economies, but a generalized situation that is being worse because of the interconnection between countries (internationalization). In this sense, one way to perceive the policy-making is by making it a possible global effort to the sustainable development’s reach. The transfer of the international best practices thanks to the Global Value Chains (GVC) and the international agreements are some evidence about how the world can be transformed by trade, and development.

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