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We are moving toward a global economy. One way

of approaching that is to pull the covers over your

head. Another is to say: It may be more complicated -

but that's the world I am going to live in, I might as

well be good at it.

-Phil Condit

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The global economy has equipped the economy with the

power to market goods and services across different countries

in the globe.Before the it came into existence, the entire economy was

ruled buy the United States. But with the stings of global

economy the power of the US has shrunk to about 25%.

First decline in global output since World War II was in 2009.

What do u mean by a GLOBAL ECONOMY?

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Advantages of Global Economy

Benefit of increasing economies of scale.

Industrial sector has benefited with the attainment of cheap labour,capital and technology.

Small companies witness rapid growth owing to a wider customer

base.

Many opine that the global economy has promoted international

peace and cooperation.

Disadvantages of Global Economy

This led to the emission of greenhouse gases.

Loss of domestic jobs.The displacement of labour in the developed countries.

Further, it is difficult to formulate regulations and legislations that

are undifferentiated across the globe.

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World GDP (PPP): $65 trillion.

GDP Growth Rate: 5.2%.

Growth Rate of Industrial Production: 5%.

GDP By Sector: Services- 64% Industry- 32% Agriculture- 4%.

GDP Per Capita (PPP): $9,774.

Population: 6.65 billion.

The Poor (Income below $2 per day): 3.25 billion (approximately

50%).

Millionaires: 9 million (approximately 0.15%).

Labour Force: 3.13 billion.

Exports: $13.87 trillion.

Imports: $13.81 trillion.Inflation Rate - Developed Countries: 1% - 4%.

Inflation Rate - Developing Countries: 5% - 20%.

Unemployment - Developed Countries: 4% - 12%.

Unemployment & Underemployment - Developing Countries: 20%- 40%.

World Economic Statistics at a Glance

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IMF Report on world economic growth forecast for 20101st ,Oct 2009

IMF predicted that the global economy would grow by 3.1

percent in 2010, 0.6 percent higher than its prediction in July2009.

Advanced economies are projected to expand sluggishly through

much of 2010, with unemployment continuing to rise until later in

the year.

Annual growth in 2010 is projected to be about 1.3 percent,

following a contraction of 3.4 percent in 2009.

Real gross domestic development (GDP) growth is estimated to

reach almost 5.1 percent in 2010, up from 1.7 percent in 2009.

China will lead Asia out of the economic recession by growingby 8.5 percent in 2009 and 9.0 percent in 2010.

India is expected to expand by 5.4 percent in 2009 and 6.4

percent next year.

Russia would grow 1.5 percent in 2010 from - 7.5 percent in

2009.

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Group of six-G6 The concept of a forum for the world's major industrialized

democracies emerged following the 1973 oil crisis and subsequent

global recession.

The Group of Six was an unofficial forum which brought together

the heads of the richest industrialized countries:France.

Germany.

Italy.

Japan.

The United Kingdom.

The United States.

The six leaders agreed to an annual meeting organized under arotating presidency, forming the Group of Six (G6).

The summit was intended as a venue for resolving differences

among its members. As a practical matter, the summit was also

conceived as an opportunity for its members to give each other

mutual encouragement in the face of difficult economic decisions.

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Issues which were discussed at this summit included: Searching and productive exchange of views on world

economy. Political and economic responsibilities of democracies.

Growth of interdependence and fostering international

cooperation.

Inflation and energy crises.

Unemployment and economic recovery. Fostering growth of world trade.

Monetary stability.

Multilateral trade negotiations.

Economic relations with the Soviet Union and the Eastern Bloc. Cooperative relationship and improved understanding of

developing countries.

Conference on International Economic Co-operation.

Cooperation via international organizations.

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It was formed in 1976, when Canada joined the Group of Six.

The G7 is the meeting of the finance ministers from a group ofseven industrialized nations.

The G7 held a meetings in 2008 and 2009, to discuss the global

financial crisis of 2007-2009. The group of finance ministers has

pledged to take "all necessary steps" to help stem the crisis. Theirwork is supported by regular, functional meetings of officials

G7 Finance Deputies :The concern that G7 officials expressed

about swings in exchange rates wasn't enough to change currency

traders' outlook for the U.S. dollar.

The dollar's decline of 8.5 % against the euro and 10.8 % drop

versus the yen in 2008.

G7 COUNTRIES :

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G8 COUNTRIES :

At the invitation of U.K. Prime MinisterTony Blair and U.S.

President Bill Clinton, Russia formally joined the group in 1997,resulting in the Group of Eight, or G8.

The G8 lacks an administrative structure like those for international

organizations, such as the United Nations or the World Bank.

G8 member factsAll eight of the G8 countries are amongst the 10 top-ranked leading export

countries.They have nominal per capita GDP over US$40,000 dollars.

Some of the world's twenty (20) largest stock exchanges by market value are

in G8 countries.

The G8 countries represent 7 of the 9 largest economies by nominal GDP.

France and the United Kingdom have expressed a desire to expandthe group to include five developing countries, referred to as the

Outreach Five (O5) or the Plus Five: Brazil, China, India, Mexico,

and South Africa.

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At the Heiligendamm Summit in 2007, the G8 acknowledged a

proposal from the EU for a worldwide initiative on energy efficiency.

On 8 June 2008, the G8 along with China, India, South Korea and

the European Community established the International Partnershipfor Energy Efficiency Cooperation, at the Energy Ministerial meeting

hosted by Japan holding 2008 G8 Presidency, in Aomori.

G8 Finance Ministers in 34th Summit of the G8 they agreed to the

G8 Action Plan for Climate Change to Enhance the Engagement ofPrivate and Public Financial Institutions. to be implemented after

2012.

Criticism and demonstrations

The best-known criticisms centre on the assertion that members

of G8 are responsible for global issues such as poverty in Africa anddeveloping countries due to debt and trading policy, globalwarming due to carbon dioxide emission, the AIDS problem due to

strict medicine patent policy and other issues related toglobalization.

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The Group of Ten orG10 G10 refers to the group of countries that have agreed to participate

in the General Arrangements to Borrow (GAB). The GAB was

established in 1962, when the governments of eight IMF membersG7+ Belgium, the Netherlands, and the central banks of two others,

Germany and Sweden, agreed to make resources available to the IMF

for drawings by participants, and, under certain circumstances, for

drawings by nonparticipants. The GAB was strengthened in 1964 by the association of

Switzerland, then a nonmember of the Fund, but the name of the G10

remained the same

. The following international organizations are official observers of

the activities of the G10: The Bank for International Settlements (BIS),European

Commission, IMF, and OECD.

The Group ofTen signed the Smithsonian Agreement in December

1971, replacing the world's fixed exchange rate regime with a floating

exchange rate regime.

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G20 Major economies G20 is a group of finance ministers and central bank governors

from 20 economies: 19 countries, plus the European Union. The

current chair country of the G-20 is South Korea.

Membership

1.Argentina, 2. Australia, 3. Brazil, 4. Canada, 5. China,

6. France, 7. Germany, 8. India, 9. Indonesia, 10. Italy,

11. Japan, 12. Mexico, 13. Russia, 14. Saudi Arabia, 15. SouthAfrica, 16. South Korea, 17. Turkey, 18. United Kingdom,

19. United States, 20. European Union.

In addition to these 20 members, the following forums and

institutions, as represented by their respective chief executive

officers, participate in meetings of the G-20International Monetary Fund

World Bank

International Monetary and Financial Committee

Development Committee of the IMF and World Bank

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The G-20 Summit was created as a response both to the financial

crisis of 20072010 and to a growing recognition that key emerging

countries were not adequately included in the core of global

economic discussion and governance.

The inaugural meeting of G20 took place on 15-16 December 1999

in Berlin

In 2006 the theme of the G-20 meeting was Building and

Sustaining Prosperity. The issues discussed included domesticreforms to achieve sustained growth, global energy and resource

commodity markets, reform of the World Bank and IMF, and the

impact of demographic changes due to an aging population.

In 2008 Spain and The Netherlands were included by French

invitation for the G-20 Leaders Summit on Financial Markets andthe World Economy.

Guido Mantega, Minister of Finance, Brazil, was the chairperson

of the G-20 in 2008; Brazil proposed dialogue on competition in

financial markets, clean energy and economic development andfiscal elements of growth and development.

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B RI CBrazil, Russia, India, and China

They account for 25% of the world land area and 40%

of world population.

Combined GDP of 15.435 trillion $.

Biggest and fastest growing market of the world.

Brazil Russia India China

GDP( in trillions $)

1.994 2.076 1.209 4.32

FOREXreserve(in billion $)

235.7 341.7 285.5 2273

Exports

(in billn $)

197.9 476 175.7 1430

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Dreaming with BRICs: The Path to 2050The Goldman Sachs global economics team released a follow-up report to

its initial BRIC study in 2004.

Goldman Sachs argues that the economic potential of Brazil,

Russia, India, and China is such that they could become among

the four most dominant economies by the year 2050.

It also predicts China and India, respectively, to be the

dominant global suppliers of manufactured goods and services

while Brazil and Russia would become similarly dominant assuppliers of raw materials.

By 2025, it is calculated that the number of people in BRIC

nations earning over $15,000 may reach over 200 million.

According to the report, first China and then a decade later

India will begin to dominate the world economy. India has 10 of the 30 fastest-growing urban areas in the

world and, based on current trends, we estimate a massive 700

million people will move to cities by 2050. This will have

significant implications for demand for urban infrastructure,real estate, and services

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1st BRIC summit

The BRIC countries met for their first official summit on 16

June 2009, in Yekaterinburg, Russia.

The core focus of the summit was related to improving thecurrent global economic situation and discussing how the four

countries can better work together in the future, as well as a

more general push to reform financial institutions.

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There was also discussion surrounding how developing nations,

such as those members of BRIC, could be better involved in global

affairs in the future.

In the aftermath of the summit the BRIC nations suggested thatthere is a need for a new global reserve currency that is 'diversified,

stable and predictable