The Global Financial Crisis

The global financial crisis has really started to show its effects in the middle of this year. Around the world, stock markets have fallen, large financial institutions have collapsed or been bought out, and governments and even the wealthiest nations have had to come up with rescue packages to bail out their financial systems. Because of these effects, not just the wealthy will suffer, but potentially everyone. 

 Due to these happenings in the West, countries in Asia are increasingly worried. For the developing world, the rise in the cost of food, high fuel prices, and the soaring commodity prices are having a compounding effect.  

 According to some articles, perhaps ironically, African countries will not be affected from the crisis, at least not initially. This is because of Africa’s generally weak integration with the rest of the global economic system. The wealthier ones, who do have some exposure to the rest of the world, however, may face some problems. 

 As for the Latin America, much of its trade depends with United States. As a result, Latin America will also feel the effect of US financial crisis and a slower growth in Latin America is expected.

Many Asian countries, including Philippines, have seen their stock markets suffer and currency values going down. In addition, there is increased foreign investment from West in Asia. Asian products and services are also global, and a slowdown in wealthy countries means increased chances of a slowdown in Asia and the risk of job losses.

  Since Philippines is also attached to US, then it is expected that the financial meltdown will have a great impact in the Philippine economy. Current increases in the prices of oil and food products worsened by the adverse impact of the US meltdown will likely increase the number of poor several times in the coming years. Due to the problems in the West, several OFW’s need to go back to the country to look for job again, becoming jobless. Also, because most investors are from the West, there’ll be lesser investments or maybe decrease that will cause some people to be jobless; thus, there’ll be higher rate of unemployment. In the end, the rich will be blown off while the poor will be the poorest.