The recession in Great Britain began with the spring season of the year 2008 and had its supposed end a year later which has been measured on technical terms. The economy ascended again but was hit hard by the snow in December 2010. In 2011, the pace of recession had slowed down to a great deal. The rise in Value Added Tax and the income tax levels of the upper middle class provider some amount of relief. But the biggest problem remains the race in which the companies and consumers are tied up to solve their problems related to finance. This will lead to less expenditure and shrugging off the debts which will adversely affect the economy of the country on short term basis but offer better results in the long run.
Global Recession has Greatly Affected the Economy of Africa
Summarizing Financial Crisis in Great Britain:
It all began with dispute in reimbursement of the U.S.A.’s subprime mortgages which led to a huge concern related to lending in the month of August in 2007. This is how the credit crunch started for the U.K. Consequently, the house prices of Britain plummeted and regained stability only in April 2009. The first stage of crisis pinched the consumers as the prices of the commodities shot up in 2007 while 2008 witnessed demands from countries like India and China for food, petrol and other necessities. As a result, the inflation hindered the process of cuts in rate of interest for easing credit crunch issue.
Inhibitions grew with the downfall of Bear Sterns leading way for the proper crisis with Lehman Brothers’ fall. Soon after in October HBOS and Lloyds were merged together. However, no one of these bailouts could stop the recession which started in the year 2009 and eventually grew on as “double-dip” recession.
How this Recession Hit African Aid System:
The biggest impact was faced by Official Development Aid (ODA) which provides funds to almost all the UN agencies in Africa. Seventy percent of the monetary relief for the UNICEF is deposited in ODA’s account. In 2007, this amount raised up to $3 billion.
The continuity in financial crisis on a global scale does indicate that the countries will give priority to their domestic needs before helping out with aid for foreign countries. John Clancy, who is a member of the Humanitarian Aid and Development of European Commission, commented that not just the Nations belonging to the European Nation but also other donor countries would be bound by home policies to take care of their economy before getting involved in donations.
However, there has been no decline in contribution from the United Nations but potential impact of the recession cannot be assessed. Also, the U.S.A. which is the second highest donor to the ODA has continued its aid despite the fluctuations in the global economy.
It can be concluded that the recession’s impact has been detrimental to some effect but assurances from Developed countries and continued support from t he UN are positive signs for sustenance of the African economy.
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