Opinion | Editorials
Business must take over from politics now
Banks and other players need to use this opportunity to get commerce moving again.
- Gulf News
- Published: 23:31 November 29, 2008
Political leaders across the world have shown unusual resolve in their efforts to ward off a recession that could destroy the social and economic gains that the past ten years of relative prosperity has brought to countries across the globe.
In the United States, George Bush and Barack Obama have pushed through bailout packages worth around $1.5 trillion (Dh5.5 trillion) to prop up the financial system and the housing market. In the UK, Prime Minister Gordon Brown is preparing to spend his way out of a looming recession, taking the politically dangerous step of hiking taxes to make this possible.
In the Gulf, governments have provided billions of dollars to support the banking industry and stock markets and restructured finance providers to strengthen the property market.
While not everyone will agree with them, these decisive actions have given investors and consumers confidence that - even while countries across the globe either slide into recession or face a severe slowdown - governments are doing what they can to limit the fallout and get the global economy working again. This is vital because until consumers and investors are confident that it is safe to lend and spend their money, the global economy will remain stuck in its present, disastrous rut. Generally, government intervention has been limited and aimed at tackling the practical problems in the markets - like the lack of liquidity in the financial system - that have led to the present crises. This is the right approach. Reckless interference and regulation of the markets, driven by political and ideological grandstanding, would delay an economic recovery and set a destructive precedent that could take years to sort out. Governments across the world have shown the political will to tackle the crises. Banks and other major players in the world economy must now use the room states have created to get local and international commerce moving again.
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