While globally the downturn of the economic tide has affected many nations, countries like Argentina, Turkey, Ukraine, and Thailand might have another factor to blame for their current economic instability: their national governance. While the macroeconomic dilemmas have not gone away in these countries, they were foreseeable and some countries have been meeting them and have returned to somewhat financial normalcy. The article goes onto describe the role of governance in the countries above and how these countries need to begin to look inward if they hope to make it out and not fall of the track of progress altogether.
This article brings up a good point about how sometimes in the aftermath of economic downturn the government will still attribute poor conditions to economic factors even if they no longer have a bearing on the situation. Is there a point to doing this other than trying to keep the population calm or save the government's image because they are failing at correcting the problem? In so, is there a way to correct these governments without violence or upheaval?
http://www.nytimes.com/2014/02/09/business/international/why-emerging-markets-should-look-within.html?_r=0
4 comments:
The American answer: reform government so as to allow for more individual freedoms, which will in turn have a positive affect on economic opportunity.
I think the article is right in that the core issue that the governments need to do what is best its citizens and not what is best for its image.
It is sad to say, but it seems only violence from the people and not just simple protests is what will make the government take action. This is a big problem. Even if the violent protesters get some of their demands fulfilled, the fact that the people resorted to violence will make foreign investors wary. In my opinion though, that wariness would likely be short term. Hopefully, the protests will accomplish long term changes.
Very interesting article and I believe that it hits at good point especially in relation to Ukraine. I have been following the protests in Ukraine and it appears that reforming the government is much harder than was thought at first. The issue is that the governments that hide their corrupt activities and inability to correct the economic situation are not willing to concede to reform diplomatically because they understand that any reformation can leave them out of the power and ability to control finances of the country. In case of Ukraine the issue is even worse because the government officials have been involved in many corrupt and criminal activities, meaning that the new government will mean that they could be persecuted and tried for their crimes. Thus, the outcome is that they cling to their powerful positions till the end and resort to anything including violence against their own people.
In order to reform those types of governments, international authorities need to get involved and put a pressure on the government. One way to do so without putting boots on the ground is sanctions consisting of freezing the accounts and prohibiting an entry into the countries outside of the home country.
Emerging countries, especially India were riding the global boom. a rising tide lifts all boats. The government got extremely complacent and highly corrupt. Social Welfare schemes which India could not afford were launched and this ended up filling the pockets of corrupt politicians, just like in Russia in the winter olympics, the Commonwealth games in India was highly scandalized and corrupt. In response to this a new political scene was launched which focuses only on corruption
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