The Jeddah Chamber of Commerce and Industry (JCCI) and the Gulf Research Center (GRC) have announced that the 2010 Jeddah Economic Forum will have as its theme "The Global Economy in 2020." As the premier event in the Middle East, the 2010 Jeddah Economic Forum will highlight the strategies required and/or anticipated for global economic development and growth, and bring together leading decision-makers, experts, businessmen and academics to discuss the outlook for the world economy in the next ten years in the key sectors of banking and finance, energy and the environment, trade, agriculture, industry, education, health, and science and technology.
Experts and officials are debating whether the end of the global economic crisis is in sight and recovery is gradually taking place. In contrast to looking at the current implications and causes, the 2010 Jeddah Economic Forum proposes to focus beyond the current crisis, at the shape and leading characteristics of the next phase of global growth, which will be well underway ten years from now. To be able to anticipate developments and take advantage of opportunities, the focus has to be on the state of the global economy in the next decade.
The growth phase that just concluded was dominated by the Reagan and Thatcher doctrine: liberalize, de-regulate, deflate the role of the state. This ideology has now clearly lost its appeal: the pendulum is swinging back. The question that is central is just how far back will the swing be? In this context, the 2010 Jeddah Economic Forum will debate various parallel shifts taking place in the global economy that could have relative importance in the upcoming decade. Key stipulations include:
· Financial intermediation will relatively lose importance; at the same time, manufacturing will recover some of its lost importance
· State investment in infrastructure and in key social services – notably education – will attract increased resources; this never stopped in the emerging countries, but the advanced industrial countries just will not be able to take their competitiveness for granted any longer.
· Growth will continue in the emerging countries, which will increasingly trade with each other and sustain domestic consumer demand. In contrast, growth in the industrial countries will be hampered by the need for restructuring (some sectors growing rapidly, others shrinking; private and public debt being slowly reabsorbed; preoccupations for inflation quickly following the liquidity-creation bonanza of the last few months).
· Environmental preoccupations will gain importance and governments will pay more effective attention - as opposed to just lip service – to preserving the environment. Climate change will be the main, but surely not the only environmental preoccupation on the agenda.
· Energy policies will be pursued in the industrial countries to diversify sources and reduce reliance on oil and gas. The same will happen in the Gulf countries, where the power generation fleet must urgently be diversified from exclusive reliance on oil and gas to a more diversified composition including solar and nuclear, possibly also wind.
· Major new technologies will be deployed to improve the efficiency of engines, the insulation of homes, the effectiveness of remote communications for work and interaction.
· Greater attention will be paid to agriculture: the drive to produce bio-fuels will be just one component of this – higher standard of living and consumption in the emerging countries will be a more important factor.
· Health issues are emerging as vital component of a sustainable policies’ package, as issues such population growth, urbanization, environmental changes, widespread poverty, increasing inequity, war and other conflict situations, as well as existing and emerging communicable and chronic diseases will need to addressed. This will emerge as a major component of impending economic considerations.
· Income distribution will again be regarded as important. In the industrial countries, policies will be adopted to give new life to the seriously weakened “middle class”; in the emerging countries, extremes of wealth and income concentration will be looked at critically and pressure will mount to address them.
In the meantime, some of the key questions that remain are:
· Will global trade liberalization survive the recession? For now, the answer is not clear-cut: while it is unlikely that the essence of free trade might be abandoned, it is possible that some limitations are agreed and introduced to protect against excesses.
· Will "new" multinational corporations be allowed to take over some of the ailing giants of the past?
· Will regional economic integration (trade, finance, monetary) make further progress?
The 2010 Jeddah Economic Forum will address critically the various aspects of the issues outlined above with the aim to move towards some form of policy consensus.