WE live in challenging times. The global economy is experiencing an economic crisis of unprecedented proportions. For the first time in decades, the United States has lost its Triple A rating and has now been downgraded, resulting in much turmoil and volatility in the global financial markets.
US Vice-President Mr. Joe Biden felt obliged to make an official visit to China to ease concerns and anxiety by that country which has invested heavily in the US financial markets and, therefore, stands to lose the most should the US default on its debt obligations.

The economic and social crises are manifested in high unemployment rates which have now reached record levels. Roughly one out of every ten American workers is out of employment.

The sad thing about it is that there is no short-term solution as the economy is likely to contract further with the recent policy prescriptions passed by Congress to cut public spending and simultaneously put a brake on tax increases on the rich and those who can afford to pay.

The multi-billion stimulus package intervention by the Obama administration has not made any real impact on the ordinary people as most of the money went to bail out the banking system and other big industries from possible collapse.

Similar situations are playing out in several European countries notably Portugal, Italy, Greece and Spain –  the so-called PIGS countries. By way of contrast, countries such as Brazil, Russia, India and China, (referred to as BRIC countries) are recording unprecedented levels of economic growth with the latter country poised to overtake the United States as the largest economy in the world.

Were it not for the high demand by China and, to a lesser extent India, for raw materials to fuel its high growth rates, commodity prices on the world market would have dipped with disastrous consequences especially for smaller and emerging economies.

The global crisis in the western world is largely ideological and has demonstrated in no uncertain terms the dangers of unbridled capitalism and market fundamentalism.

Capitalism by its very nature is driven by the need to optimize profits without regard to social consequences. This is why the PPP has always embraced an approach to development that is people-centred, whereby the resources of the state must be put to enhance the quality of life of the Guyanese people.

Considering the perilous state of the global economy, we have done well as a country to cushion the effects of the global financial and economic crises. This speaks to the prudent and astute management of our economy and the fiscal discipline adopted by the administration to control inflation and consequently protect the social and economic gains made by the PPP/C government.