After the G20 finance ministers meeting held in St. Petersburg, the arguments for economic growth and fiscal stagnation have disappeared. As the European economic recession has been delayed, the growth of emerging markets has also slowed down. The biggest concern is the budget deficit. What is more worrying now is economic growth. The International Monetary Fund (IMF) revised its global economic growth forecast in July, the second time this year.
Under the prospect of a global downturn, Japan and the United States stand out from the crowd. In Japan, Prime Minister Shinzo Abe has made a rapid monetary and fiscal expansion policy and promised to reform the labor market, corporate governance, regulation and trade. The stimuli of the decisive measures have worked, and the Japanese economy is expected to grow by 3% this year, which is the leader in the development economy. The Nikkei 225 index rose 80% in the first half of May. Today, Abe has hinted that it will continue to promote strict structural reforms. If he wants to get what he wants, his policy will become a key force for Japan’s reinvention.
As for the United States, the recovery continues, and the drag on growth has subsided. The state and local government budget deficits have improved, the housing market has strengthened, and household debt has been reduced. The prospects for US economic growth may be frustrated by the political wrestling of the two parties, which has caused another wave of losses. The Republican Party’s remarks are predicting that there will be fiscal austerity.
However, there are many reasons that have been repeatedly ignored, which can make people optimistic about the growth potential of the United States. A recent study by the McKinsey Global Institute proposes the key to reversing the five major interactions that can have a significant impact on GDP growth, productivity, and employment by 2020: shale energy, massive data analysis, knowledge-intensive industry exports, Infrastructure investment and talent development. Among them, shale energy and huge amount of data analysis are based on the continuous breakthrough of technology, and the United States is far ahead. It is mainly based on the actions of private enterprises, not on the general economic and structural policies.
Over the past five years, US shale oil and gas production has grown at an annual rate of more than 50%. Due to the increase in supply, US natural gas prices have fallen by two-thirds since 2008, and trends that are significantly lower than in other parts of the world may remain at least until 2020. This price advantage can enhance the competitiveness of the United States in manufacturing, especially in energy-intensive industries.
Huge amounts of data and advanced analysis are another key to technology-driven growth in the United States. As more and more data is generated, stored, and transmitted in digital form, new data sets that are critical to personal and business decisions are growing dramatically. These data sets can be quickly analyzed due to advances in computer computing power, the advent of cloud computing, and the addition of new software tools. Companies can be used to reduce costs, increase productivity, and develop new products and services.
Huge amounts of data and advanced analysis can reduce the cost of medical and government and increase efficiency, creating value for consumers through more and better quality products. These are the benefits that are not counted by GDP. .
New information and communication technologies are the key to reversing the growth of the US economy in the 1990s. McKinsey research believes that shale energy and massive data technology will be the key to reversing in the next few years, and will bring the same economic growth benefits.
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