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ADDRESSING ECONOMIC IMBALANCES

ADDRESSING ECONOMIC IMBALANCES. SIMUN 2010 ECOSOC 1 Nekane Tanaka. What is an economic imbalance?.

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ADDRESSING ECONOMIC IMBALANCES

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  1. ADDRESSING ECONOMIC IMBALANCES SIMUN 2010 ECOSOC 1 NekaneTanaka

  2. What is an economic imbalance? Economic imbalances can be very simply defined as “widening current account deficits or surpluses”. (A FRAMEWORK FOR ASSESSING GLOBAL IMBALANCES, European Central Bank paper, January 2008) Economic imbalances come from trade deficits, meaning a country exports significantly more than it imports or vice versa, creating debt.

  3. What are the consequences of economic imbalances? • Economic imbalances can create a relationship of dependency between economies (troublesome in times of crisis). • There may be tensions between countries, and economic and political pressures could lead both countries to adopt more protectionist policies at a time when the global economic recovery remains fragile.

  4. What is the UN doing to address this issue? There are several UN organisations and NGOs working on tackling this issue: • United Nations Conference on Trade and Development (UNCTAD) • World Trade Organization (WTO) • International Monetary Fund (IMF) and World Bank

  5. What actions can Nations take? Without addressing global economic imbalances immediately, the economic crisis recovery will be neither solid nor sustainable. Therefore Nations must work towards eliminating economic imbalances by agreeing on a realistic approach to cut trade deficits.

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