SINGAPORE (Aug 19): The past week may have marked the juncture when the many stresses in geo politics and the global economy reached a tipping point: It is now more likely that we will get a series of political shocks and an accelerated downturn in the world economy. Political hot spots — in Hong Kong, Italy, Brexit, Argentina and South Asia — are turning critical. New data suggests that the prospects for global economic growth have also taken a knock. Yes, the major central banks will now cut interest rates more aggressively, but monetary policy cannot alone overcome the headwinds. Therefore, the outlook for trade-dependent Asian economies cannot be good — unless their governments respond quickly and effectively.
What has changed — political flashpoints turning ugly
Anyone looking for good news in world politics is going to be disappointed. Tensions that have been simmering for some time could reach a critical point in several areas: