More than 200 researchers and policymakers came together in Helsinki in mid-May to celebrate UNU-WIDER's 25th anniversary and to discuss the 'Triple Crisis' of finance, food and climate change--and its implications for poverty, inequality and human development. Energetic debate, from a wide range of perspectives, took place over 13-15 May.
This is at a time when the global economy is passing through a period of profound change. How to interpret that change, and what it means for the next 25 years of UNU-WIDER research and training, was central to the Triple Crisis conference. And how economics as a discipline refocuses itself on the really important dangers facing humanity was an issue that ran throughout the 3 days of debate.
The Financial Crisis
The immediate concern is with the global financial crisis, which has reverberated across the world for the last two years--with commentary switching regularly between optimism and pessimism. While the crisis originated in the under-regulated financial systems of the North, it hit the South. And while the South has performed better than initially expected--helped by continued growth in the emerging economies--the financial crisis has placed a major strain on the fiscal position of the world's richer countries. At some point the massive dose of Keynesian medicine that rich countries put in place after the onset of the financial crisis will be reversed, and we do not know how the global economy will respond to this tightening of fiscal and monetary policy after their unprecedented easing.
The UNU-WIDER conference saw much debate on what the developing world should do next to offset likely future shocks. This is in a world where developing countries have had to self-insure--through the accumulation of large foreign-exchange reserves--given the continuing weaknesses in the international support available to meet shocks. There has not been a repeat of past currency crises in the South, which generally entered the global economic slowdown in better shape than before. Africa, especially, has gained some room for manoeuvre after its hard-won battles to build policy capacity, although the region remains much too dependent on the fortunes of world commodity markets. No country, rich or poor, is unaffected by contagion across financial markets, and the UNU-WIDER conference took place amidst much turbulence in the euro-zone--reinforcing the message that the global economy is not yet 'post-crisis'.