The Economy of Romania
Before World War II, the Romanian economy was primarily agricultural.
In 1948 the Communist government came to power and took control of
nearly all aspects of the economy. Through a series of five-year
plans, the Communists transformed Romania into an industrial nation.
The economy grew considerably during the first part of the Communist
period, but by the 1980s it had slid into decline, and shortages of
consumer goods and degradation of the environment had become
widespread. After the Communist government was overthrown in 1989, the
Romanian economy virtually collapsed. Although dominated by former
Communists, the new government began taking steps to reform the
economy in the early 1990s. These steps included devaluing the
national currency, removing government subsidies on most consumer
goods, and converting some state-owned companies to private ownership.
The Romanian economy declined considerably in the early 1990s. After
several years of decline, the gross domestic product (GDP) increased
by about 1 percent in 1993. In May 1994 the International Monetary
Fund (IMF) issued the Romanian government a $700 million loan, which
helped to lower the country’s inflation rate by 1995. Although
Romania’s private sector grew considerably, especially in the area of
services, most of the country’s industrial production remained in
state hands in 1995. This provoked concern among international
lenders, with the IMF suspending further loans, and hindered Romania’s
efforts to attract foreign investment.
In June 1995 the Romanian parliament passed a mass privatization
program with the goal of transferring more than 2,000 companies to
private ownership. Due to the continued slow pace of economic reform,
however, the IMF did not resume disbursing loans to Romania in 1996,
and foreign investment remained negligible. In 1997 the Romanian
government promised to institute rigorous reforms and the IMF
responded by awarding the country a $430 million loan. However, the
government only succeeded in lifting price controls before
privatization bogged down again. In January 1998 the IMF froze
disbursement of loans to Romania once again. Most companies remained
in state hands as of early 1999.
Sovereign lending, throughout history, has been marked by occurrences of partial default and repudiation by governments of all kind; from medieval princes to dictators to democratic regimes. In the 1970s lending to lesser-developed countries led to the rescheduling and partial defaults in the 1980s. Even the sustainability of the debt of nations such as Belgium, Canada, Italy and even the United States is not free from suspect.
The July 1990- march 1991 recession lasted eight months and was caused by many different adverse financial problems on the environment in the early 90’s. Most post was recessions are short as this one was. They tended to last only up to eleven months at a time. On October of 1987 Black Monday occurred which caused the stock market to crash. The Persian war joined with the rising infiltration rates created this recession. When the recession began the Fed began to try to reduce infiltration, which then limited economic expansion.(Kevin Mulligan Recessions) Extreme changes in the GDP growth began to emerge at the beginning of 1990’s, however the overall growth seemed to remain positive. As a result of this recession a loss of consumer and business confidence was lost due to rising of oil prices along with an already weak economy.
The economics of Haiti has deceased in the last 4 years after the devastating earthquake that struck it 4 years ago. The Haiti economy has become very poor and one of the poorest country in the south, Central America and Caribbean region making it ranked 24 out of 29 countries in this area and its overall score is below average. Haiti’s economic freedom is 48.1 making it economy the 151st freest country while in the last several years Declines in the management of government spending, freedom from corruption, and labor freedom make its overall score 2.6 points lower than last year. Recovering from the disastrous earthquake in 2010 with the support of the U.S. recovering efforts “Haiti’s post-earthquake reconstruction efforts continue, assisted by substantial aid from the international community. Governing institutions remain weak and inefficient, and overall progress has not been substantial. The parliament has not renewed the mandate of the Interim Haiti Recovery Commission, which had been tasked with overseeing reconstruction efforts but was unpopular.”( .heritage.org). The open market of Haiti trade weighted to be 2.1 this is because the lack of tariffs hamper the trade freedom of Haiti. Foreign investors are given national treatment but the investment is small and the financial sector is remained underdeveloped and does not provide any adequate support.
This economic growth didn’t however continue for long, with the economy peaking just before the start of the year 2000 followed by a sharp downturn that resulted in a temporary recession occurring around the middle of the year. This erratic behavior, most pronounced in retail trade, can be explained by the effects of both the millennium bug and the introduction of a general consumption tax in the form of the GST. The millennium bug caused much panic and with it bought panic spending especially in the IT sector thereby over inflating an already close to booming economy and after the non-event that the millennium (or Y2K) bug caused spending slumped and then further slumped due to the holding back of consumer spending on big ticket items such as cars and houses until the introduction of the GST.
The Soviet Union, which was once a world superpower in the 19th century saw itself in chaos going into the 20th century. These chaoses were marked by the new ideas brought in by the new leaders who had emerged eventually into power. Almost every aspect of the Soviet Union was crumbling at this period both politically and socially, as well as the economy. There were underlying reasons for the collapse of communism in the Soviet Union and eventually Eastern Europe. The economy is the most significant aspect of every government. The soviet economy was highly centralized with a “command economy” (p.1. fsmitha.com), which had been broken down due to its complexity and centrally controlled with corruption involved in it. A strong government needs a strong economy to maintain its power and influence, but in this case the economic planning of the Soviet Union was just not working, which had an influence in other communist nations in Eastern Europe as they declined to collapse.
The International Monetary Fund (IMF) is an international organization was set up in 1945 after World War II. The whole world had experienced severely destruction during the period World War One and World War Two, each state need the restorative processes and a good platform to recover its inherent ability and make their citizens get rid of poverty, hence economy problem it was the first problem that states should be concerned.
The New Economic Policy was in many ways a reactionary policy put forth because of widespread public disdain for War Communism (Richman 1981,92-93). War Communism was the set of policies enacted by the Bolsheviks from the time they took power in 1917 until the establishment of the NEP in 1921. Under War Communism private industry was essentially eliminated, farms were collectivized, industry and business were taken over by the government. The peasantry had not been very accepting of having the land they were so recently granted ownership of being taken away once again by the government. Because of this there was little motivation on farms to grow more than what was necessary for the family because they were seeing no benefit from a surplus of crops. Workers in cities were driven back out to the farms to avoid starvation and as a result production collapsed in the Soviet Union to below pre- WWI. War Communism saw a steady decline in popularity as the Civil war wound down but the final straw came with the Kronshtadt Rebellion in March of 1921. Then a force of sailors sympathetic to pr...
During the time of economic crisis starting around 2010 different rationalities have been taken to try and continue economic growth while maintaining a stable government system that is helping and not hurting. When examining government spending and how it affects the growth of the Gross Domestic Product (GDP) there seems to be disagreements on if it was helping or damaging the prospective growth that could be made. By using the Multiplier Effect the government can estimate how to adjust their government spending and how it effects the spending of the consumer, investments and spending of country’s exports.
After the dissolution of the Soviet Union in 1991, the question of economic reform was extremely prevalent. Since the Soviet Union had been “defeated,” Communism was consequently defeated. This resulted in Western powers, particularly the United States, and Western banks debating what should be done to the post-Soviet economies. At the same time, however, non-Soviet states were also undergoing economic transitions. The two main modes of economic reform were Shock Therapy and Gradual therapy. Shock therapy consisted of a rapid-fire shift from a Communist economy to a capitalist one. Shock therapy was notably practiced in Russia and Poland, with tremendously different results. The most well-known gradualist transition may have been China, but
The growth was expected to gradual slow down, but con... ... middle of paper ... ... were basically led by the promise of a great profit, this false pretense helped people in high authority to be blinded by the chances of certain personal goals so they only cared about continuing their personal and collective growth without analyzing the decisions correctly and understanding the recklessly of there actions, they failed to anticipate that their selfish actions would eventually and inevitably has a severe effect on the Irish economy as a whole and for many individuals who are now jobless as a result. The recession has affected almost everyone and methods must be engaged to punish those who acted irresponsible and learn from our mistakes to protect the future economics solidity of the state. http://www.wsm.ie/c/introduction-crisis-ireland-causes-conflicts http://www.irishtimes.com/business/economy/ireland/blinkered-thinking-at-the-heart-of-ireland-s-
the effect that the work of the IMF and the World Bank have had on the
In order to assess the current state of the economy, the examination of important economic indicators or variables has always played a vital role in the understanding of the complex economic systems we live in. The analysis of these economic variables studied by many, not only has served as a tool to evaluate the current economic performance of a country, but also has allowed experts to envisage and continue the pavement of an economy's road. Currently, some economic variables have had favorable improvements indicating a general good outlook for the economy for the following months, requiring a further individual analysis and comparisons in order to foresee crisis or successes.
Debt crisis is becoming common and faced by most citizens in Malaysia. Between June 1997 and January 1998 a financial crisis swept like a brush fire through the "tiger economies" of SE Asian. Over the previous decade the SE Asian states of Thailand, Malaysia, Singapore, Indonesia, Hong Kong, and South Korea, had registered some of the most impressive economic growth rates in the world. Their economies had expanded by 6% to 9% per annum compounded, as measured by Gross Domestic Product. This Asian miracle, however, appeared to come to an sudden end in late 1997 when in one country after another, local stock markets and currency markets imploded. When the dust started to settle in January 1998 the stock markets in many of these states had lost over 70% of their value, their currencies had depreciated against the US dollar by a similar amount, and the once proud leaders of these nations had been forced to go cap in hand to the International Monetary Fund (IMF) to beg for a massive financial assistance. (W.L.Hill, n.d.)
In the year of 1327, Kind Edward III of England defaulted on his Italian debts. This caused the banks of Bardi and Peruzzi in Florence to collapse. Who would know that over 650 years later, the world would still have these types of problems? After World War II, the need for an organization like the IMF was finally realized. After the war, politicians and economists began to work on blue prints for a postwar world. They envisioned a liberal international economic order, based on stable world currencies and revived world trade. The International Monetary Fund (IMF) finally came into existence on December 27, 1945. On this date, twenty-nine countries signed its charter when meeting at Bretton Woods, New Hampshire. On March 1, 1947 the IMF came into financial operations.
External historical events often changed Bulgaria's national boundaries in its first century of existence, natural terrain features defined most boundaries after 1944, and no significant group of people suffered serious economic hardship because of border delineation. Postwar Bulgaria contained a large percentage of the ethnic Bulgarian people, although numerous migrations into and out of Bulgaria occurred at various times. None of the country's borders was officially disputed in 1991, although nationalist Bulgarians continued to claim that Bulgaria's share of Macedonia--which it shared with both Yugoslavia and Greece--was less than just because of the ethnic connection between Macedonians and Bulgarians. In 1991 Bulgaria had a total border of about 2,264 kilometers. Rivers accounted for about 680 kilometers and the Black Seacoast for 400 kilometers. Ridges in mainly defined the southern and western borders high terrain. The western and northern boundaries were shared with Yugoslavia and Romania, respectively, and the Black Sea coastline constituted the entire eastern border. The Romanian border followed the Danube River for 464 kilometers from the northwestern corner of the country to the city of Silistra and then cut to the east-southeast for 136 kilometers across the northeastern province of Varna. The Danube, with steep bluffs on the Bulgarian side and a wide area of swamps and marshes on the Romanian side, was one of the most effective rivers boundaries in Europe. The line through Dobruja was arbitrary and was redrawn several times according to international treaties. In that process, most inhabitants with strong national preferences resettled in the country of their choice. Borders to the south were with Greece and Turkey. The border with Greece was 491 kilometers long, and the Turkish border was 240 kilometers long. Bulgaria covers approximately 110,550 square kilometers. Its topography is mostly hills combined with plateaus, with major flatlands to the north and the center of the country. Its main mountain ranges Balkan and Rhodope include two major ranges, Pirin and Rila. The climate is divided by mountains into continental and Mediterranean. The rainfall is very variable, with largest amounts in higher elevations.