Forecasts for the New Year vary depending on who you would like to believe but there are a number of invariables that should be taken into account while considering the political and economic fortunes of countries across the continents.
Politics under focus
In many ways, politics will shape the world in 2016, dictated by elections- Presidential and General – in Australia, Austria, Czech Republic, Georgia, Germany, Hong Kong, Ireland, Japan, Philippines, Somalia, South Korea, Taiwan and United States of America.
New Zealand will hold its local government elections with thousands of candidates contesting for local boards and councils, not to forget, Mayorality. The future of Auckland will depend on its new Mayor. There is much hope in the Phil Goff camp that he would win the much-coveted but highly challenging post.
New Zealand Houses
The New Zealand economy is likely to have a mixed bag of fortunes and otherwise but there could be more dissipation of energy on whether we should have a new National Flag, rather than whether we should be selling state houses to foreigners. The housing market is coming under increasing pressure and with investors from other countries buying more property and houses, there is a growing fear that New Zealanders will become tenants in their own country- something that Prime Minister John Key promised would never happen more than six years ago.
But the reality seems to be elsewhere.
ISIS and Terrorists
No one however overlook the intensity with which the Islamic State of Iraq and Syria (ISIS) is going about sponsoring terrorism or directly executing terrorist attacks. Europe is under fear and America has been on alert since September 11, 2001. The Fifteenth Anniversary of the terrorist attacks in New York and Washington this year would be a stark reminder of the high level of vulnerability to which the human race has descended.
Economic Growth
From an economic point of few, China and India are expected to continue their growth pattern, inevitably competing with each other. According to an OECD Report, China is on track for a fourth consecutive decade of rapid growth and will overtake the USA as the world’s biggest economy in 2016 after accounting for price differences.
Having slouched to 7.8% growth last year (its slowest in more than a decade), China’s economy will rebound to 8.5% growth this year and 8.9% next.
“There is significant scope for further catch-up in China. It has a strong record with respect to several of the key factors for sustaining growth and is well positioned to emulate the record of earlier stellar Asian performers,” the OECD said.
The OECD noted that growth would gradually ebb as China catches up to more advanced economies, but its forecast is well ahead of Beijing’s official target of 7% average growth in the five years to the end of 2015.
The Chinese economy is set to become as large as that of the US by around 2016 when assessed in purchasing power parity terms, which factor in price differences between countries, it added. The 2016 forecast is in line with the OECD’s previous estimates.
The OECD highlighted multiple risks to its outlook: a weak global economy, rising inflation, a rickety financial system, inequality and an ageing population.
But it noted that China already had made strides in cutting its reliance on external demand and that domestic rebalancing was also under way, with consumption a bigger driver of growth than investment since 2011.
India Over China
But an International Monetary Fund (IMF) World Economic Outlook Report predicted that India’s economy will overtake China in terms of its annual growth rate by 2016.
It said that India’s economy will grow at 6.3% and 6.5% respectively over the next two years, placing the country’s projected growth this year ahead of the organisation’s estimates for China.
The IMF projections represent a substantial increase from the actual growth rates of the Indian economy in 2013 and 2014, when it grew by 5% and 5.8% respectively. The IMFs World Economic Outlook projects global economic growth at 3.5% and 3.7% in 2015 and 2016 respectively.
In the field of Sports, 2016 will see a number of major events, the most important of which would be the Summer Olympics in Rio De Janeiro, Brazil (August 5 to August 21) FIFA World Cup in Japan (December 8 to 18), Hockey World Cup in Toronto, Canada (September 17 to October 1), the ICC World Twenty/20 in India (March 8 to April 3) and the World Masters Athletics in Perth, Australia (October 26 to November 6).
Our World
In our own little world, we would do better as manufacturers, importers, exporters, wholesalers, retailers, education providers and so on. We will continue to attract foreign investors, students, migrants and tourists. We will also continue the reversed trend of brain drain and attract more people from the other side of the Tasman and across the world for better economic and social prospects.
We will retain political stability and sanity but continue to debate and disagree on a number of issues and continue to hear a majority of the mainstream media supporting the National Government, failing to keep their balance.
