International Business Environment

1. INTERNATIONAL BUSINESS
ENVIRONMENT
GLOBAL WORLD ECONOMIC PROBLEMS
BY
ABY PHILIPOSE
GROUP- UMA1V22

2. CONTENTS
 INTRODUCTION
 TYPES OF CRISIS
 HISTORY OF WORLD ECONOMIC CRISIS
 CAUSES OF WORLD ECONOMIC CRISIS
 OVERALL EFFECT OF A CRISIS
 RECCOMENDATIONS
 CONCLUSION

3. GLOBAL WORLD ECONOMIC PROBLEMS
A situation in which the economy of a country
experiences a sudden downturn brought on by a
financial crisis. An economy facing an economic crisis
will most likely experience a falling GDP, rising/falling
prices due to inflation/deflation. An economic crisis can
take the form of a recession or a depression

5. TYPES OF CRISIS
 FOOD CRISIS
 FINANCIAL CRISIS
 OIL CRISIS
 INDUSTRIAL CRISIS
 EXPORT CRISIS

6. HISTORY OF WORLD
ECONOMIC CRISIS
 The World Economic Crisis came after the world war 2
At The time of a great Depression. It was the largest
and most important economic depression in modern
history, and is used in the 21st century as a benchmark
in how far the world's economy can fall. The Great
Depression had shocking effect on every country, rich
and poor. Personal income, tax revenue, profits and
prices dropped, and international trade come by a half
to two-thirds.

7. CAUSES OF WORLD ECONOMIC
CRISIS
 As a Result of Economic Crisis
 13 Million of People became unemployed.
 Unemployment in the United States rise to 25% and in
some countries rise as high as 33%.
 There is a sharp fall in export demand.
 Stock Market collapse.
 Industrial production fell.
 banks went out of business.

8. OVERALL EFFECT OF A ECONOMIC
CRISIS
 Higher bank capital requirements on the way.
 Everyone should look for "exit strategies”
 BIS study confirms some perceptions of Basle accord.
 Banks continue retreat from South.
 Asia: Crisis causes massive unemployment.
 Massive retreat by banks from emerging markets.
 Financial turmoil spreads across the world.

10. RECCOMENDATIONS
 IMF needs to neutralise the outflow of FII money by
unwinding the market stabilization securities that it had
used to sterilis the inflows when they happened
 . This will mean drawing down the dollar reserves which is
important at this hour .
 In the IT sector, there should be correction in salary
offerings rather than job cutting.
 Public should spend wisely and save more.
 Taxes including excise duty and custom duty should be
reduced to lighten the adverse effect of economic crunch
on various industries.
 Also, the government should try and improve liquidity,
while CRR and SLR must be cut further.

11. CONCLUSION
 Alternative global monetary system
 Govt., Political class must take responsibilities
 IME must also be accounted for crisis
 Experts suggest that if reforms aren’t made then
the world will suffer more crisis
 A well governed state can provide anti-dote for the
ills of the market
 Nominal exchange rate as an anchor for
inflationary expectations, pricing decisions and
wage setting