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election in malawiThe people of Malawi went to the polls in May 2019 eager to make their voices heard.  Due to some electoral static, however, the world only recently received their message. Marred by allegations of impropriety and delayed by legal challenges, a resolution came in June 2020 when the country repeated the election. On June 27, 2020, 13 months following the initial vote, the election in Malawi resulted in Lazarus Chakwera becoming the nation’s next president. Thanks to courageous actions from Malawi’s top court, a nation imperiled by electoral dysfunction has achieved a peaceful transition of power.

The Election in Malawi

Shortly following the initial presidential election in Malawi on May 21, 2019, President Peter Mutharika won by a narrow margin. However, rumors of irregularities in the vote tallies began to cast doubt on the outcome. Of the 5.1 million votes cast, Mutharika won 38.6% of the vote, compared to 35.4% and 20.2% for his closest competitors. The opposition candidates, Lazarus Chakwera of the Malawi Congress Party and Saulos Chilima of the United Transformation Movement, filed a lawsuit. This prompted an investigation of the Malawi Electoral Commission’s (MEC) handling of the election in Malawi. Additionally, the angst from the controversy spilled into the streets, where thousands of citizens engaged in peaceful protests.

Following a protracted investigation, the nation’s constitutional court invalidated the results of the election in Malawi, citing “widespread, systematic and grave” anomalies. In a voluminous report, the five-judge panel cataloged a panoply of suspicious behavior. This ranged from mathematical errors to the use of correction fluid on tallying forms. There were mixed reactions to the court’s surprising decision, as Mutharika retained power while the inquiry took place. In addition, Mutharika decried the decision as “a great miscarriage of justice.” However, others lauded the decision as a powerful demonstration of judicial independence and a hallmark of a functioning democracy.

A Second Chance

The constitutional court’s decision ordered that a new election take place within 150 days of their announcement, which came in February 2020. In June 2020, the Parliament set election day for June 23. Justice Chifundo Kachale oversaw the re-run. Kachale replaced Jane Ansah as chairperson of the MEC following Ansah’s role in the initial vote. Despite the court’s stern ruling, the extent of potential election malfeasance in the initial vote remains unclear.

Leaders of the opposition claimed that correction fluid inflated the vote totals of the incumbent. In their lawsuit, the leaders implicated the MEC. Conversely, the MEC argued the fluid had only been used to alter procedural information, not the vote totals. Luke Tyburski of the Atlantic Council’s Africa Center inspected the actual results sheets, which citizens can access online. Tyburski’s analysis suggests “human error instead of malicious tampering” likely caused the alterations. However, Tyburski suggests that this “does go a long way toward discrediting much of the sensational rhetoric surrounding the vote.” Whether malice or simply human error caused the error, Malawi’s top court felt compelled to clean the slate with a re-run.

Poverty and the Election in Malawi

The judiciary’s choice has broader implications than simply who serves as Malawi’s president. For one, it fortifies the people’s faith in the rule of law. Elections with contested outcomes are not new to Africa. Many leaders hold shambolic votes with impunity, while other electoral disputes cause a descent into chaos or even civil war. What makes the election in Malawi unique is the willingness of its high court to assert itself when warranted. It would have been easy to simply sanctify the initial elections in accordance with the wishes of the president. But the court chose otherwise. Although needing the courts to intervene in the democratic process is far from ideal, it may be necessary to restore the public’s confidence in free and fair elections.

As Malawi relies heavily on foreign assistance, this show of sound governance can only serve as reassurance for Malawi’s benefactors. These include the International Monetary Fund and the World Bank. Additionally, the court’s decision demonstrates to potential trading partners that the nation can be a stable ally. Despite a GDP growth rate of 4% in 2019, the nation’s extreme poverty rate is still around 20%. As such, the international community must see Malawi as deserving of investment and assistance to help lift its people out of poverty. The result of the re-run can do just this.

Looking Forward

When Malawians returned to the polls on June 23, 2020, the international community had a keen eye on the proceedings. This deterred potential bad actors from any hijinks and ensured that the MEC did its due diligence in properly tallying the votes. Chakwera won convincingly, garnering nearly 59% of the vote, and became president. As a result, the people of Malawi won, and democracy was victorious. This is a positive step toward garnering international aid for Malawi and reducing the poverty its citizens face.

Brendan Wade
Photo: Flickr

Innovations in Poverty Eradication in Côte d'Ivoire
Côte d’Ivoire, otherwise known as the Ivory Coast, is a country nestled in the western panhandle of the African continent. Though the country has been war-torn since 2010, Côte d’Ivoire is becoming a vital part of the world economy. Poverty in Côte d’Ivoire affects more than 46% of the population; however, the country is working to provide more jobs, funding and resources for its citizens. Here are five innovations in poverty eradication in Côte d’Ivoire.

Working with World Organizations

The government of Côte d’Ivoire is working with world organizations to help Ivorian citizens. With aid from the World Bank and the International Monetary Fund (IMF), Côte d’Ivoire is supporting economic growth and the eradication of poverty through Results-Based Management (RBM) and the implementation of Poverty Reduction Strategies (PRS).

Within the PRS document established in 2009, government officials outlined multiple poverty eradication goals. Among these goals are greater accessibility to food and healthcare as well as increased job opportunities for men and women.

Another notable organization working alongside the government to eradicate poverty in Côte d’Ivoire is the Sustainable Development Goals Fund (SDGF). This organization seeks to help vulnerable populations, such as women and children, achieve financial stability through training, counseling and education. Specifically, SDGF provides education for women who have dropped out of school or who are looking to generate their own income.

New Strategies for Ending Hunger

Among the innovations in poverty eradication in Côte d’Ivoire is adopting new strategies for ending hunger. In 2016, the Côte d’Ivoire government, with help from the World Food Programme (WFP), created a National Development Plan (NDP) to facilitate the country’s transition to becoming a middle-income economy by 2020. With help from WFP, the Ivorian government aims to increase access to food banks and work more closely with other organizations to end malnutrition.

Previously, in 2009, the Ivorian government worked with the IMF and World Bank to establish strategies for ending hunger throughout the country. To achieve this goal, Côte d’Ivoire vowed to modernize storage techniques of fresh produce, make food more widely accessible, increase the production of rice and update health standards for food supply.

Other Avenues for Helping Citizens

In Côte d’Ivoire, the mining sector is undervalued. While the mining industry previously focused on gold, there is an increased interest in nickel, iron and manganese. By expanding geographical data of the land, the mining industry could see vast profit and job increases.

Further, enhancing transportation — public and private — could help citizens escape poverty in Côte d’Ivoire, as well as better integrate the country into the international economy. Allocating more funds to road infrastructure, road maintenance and other modes of transport can facilitate domestic trading. Additionally, it could help individual citizens have better access to basic services and economic opportunities.

Becoming an Active Partner in the Global Market

The 2018-2022 Country Strategy Paper (CSP) suggests that to maintain favorable economic growth, Côte d’Ivoire should attract global investments, employ economic reforms and create more agriculture-industrial chains of supply. With support from the CSP and the World Bank, Côte d’Ivoire will receive loans to reach their economic development goals.

Côte d’Ivoire is further strengthening their economy through investments in the mining and electricity sectors, and by simplifying the start-up process and tax-paying procedure for small businesses.

Mending Gender Disparities Associated with Poverty

While gender inequalities still exist in Côte d’Ivoire, the government is working to make employment and educational opportunities more equal. More than 50% of women in Côte d’Ivoire are uneducated, and 73.7% of women are illiterate. In comparison, only 36% of men receive no education, and 46.7% of men are illiterate. To combat these disparities, funding is set aside for activities that specifically empower women. Further, more women are chosen to participate in important projects, thanks to the Affirmative Finance Action for Women in Africa (AFAWA).

With more concentrated funding in education and the job market, impoverished women can establish themselves in society and regain economic stability. According to the World Bank, it is in the country’s best interest financially to incorporate more women in the job market.

Conclusion

These innovations in poverty eradication in Côte d’Ivoire show the government’s focus on addressing this issue. It is imperative that the country continue to receive funding to incorporate itself into the international economy. By sticking to these strategies and working with world organizations, the government will hopefully be able to eradicate poverty in Côte d’Ivoire.

Danielle Kuzel
Photo: Flickr

homelessness in vietnamWhile the nation of Vietnam has long struggled with poverty, homelessness in Vietnam has been successfully reduced by the government during a period of five years ranging from 2003 to 2008. These efforts have reduced the number of street children by 62%. This accomplishment is partly due to the fact that Vietnam has been aggressively fighting poverty for years. Every year since 2012, the percentage of people who live in poverty has lowered by a range of 4.6% to 6.9%. This effectively cut the percentage of people living in extreme poverty since 2012 in half. This is due largely to the fact that Vietnam has been experiencing massive economic growth in the last decade. In addition, it has been shifting to a market-based economy with a socialistic orientation.

Millions Have Been Lifted Out of Poverty

The country has experienced significant improvement with regards to government openness and transparency, as well as education and human development. Inward investments and focusing on increasing exports have been one of the drivers of this prosperity as well as a focus on reducing poverty in the country. Overall, 30 million people have been lifted out of poverty since 1992. According to a report by the IMF, the government has been investing in housing, education and infrastructure for its vulnerable population, especially ethnic minorities and those who live in remote areas. All of this has contributed to the small percentages of homelessness in Vietnam.

There Are Still Some Challenges

While the numbers are improving for Vietnamese-born homeless children, the population of migrant children is on the rise. It is estimated, in 2006, that the number of these children was around 23,000. Migrant children, according to some reports, are coming from rural areas in Vietnam. They represent a new social phenomenon in Vietnamese society. Many of these children are homeless and their parents use them to generate income. Many of them don’t have identification or any personal papers and are very vulnerable to labor exploitation by those who employ them. Those children cannot attend university or go to the hospital. Sadly, homelessness in Vietnam often exposes them to other risks such as sexual abuse and even certain diseases.

Thankfully, there are those who are working on solutions to tackle homelessness in Vietnam. They are specifically tackling the problem of street children. Do Duy Vi, the Chief Outreach Officer of Blue Dragon Children Foundation, himself used to be a child of the streets. Today he works as a social worker trying to get children off the streets by guiding them to walk the same path he did. He offers them a similar opportunity that he was offered. He helps street children become outreach workers for the Australian funded foundation. During the period of July 1, 2017 to June 30, 2018, the foundation rescued 116 children off the streets and connected 62 of them with their families. It also represented 52 children in child protection cases and provided 107 human trafficking survivors with emergency accommodations. Part of the organization’s job also includes working with government authorities. As such, they helped the 694 government officials become more skilled in countering violations of child rights and trafficking. These are just some of the signs of hope for the destitute in this country.

More Needs To Be Done

It has been reported that 400 organizations and NGOs are helping 15,000 children living in extremely difficult situations. More needs to be done in terms of spreading awareness about the problem and explaining child protection laws that protect youngsters in Vietnam from being exploited for profit.

– Mustafa Ali
Photo: Flickr

Progress in Benin
Despite a low unemployment rate of one percent and a GDP growth rate that increased from two percent to over five percent from 2015 to 2017, progress in Benin has been slow and it is still a poor country in West Africa. With more than a third of the over 11 million population living below the poverty line, it is difficult for Beninese to live without a feeling of unease. Three major reasons Benin has a rising poverty rate is because of over-reliance in Niger’s economy, the largest exporter, reluctance for Benin to modernize its own economy and climatic shocks, particularly massive floods.

Agricultural Productivity and Diversification Project

The agriculture sector employs over 70 percent of Beninese. In an effort to boost the economy, the Republic of Benin is investing in improvements in the agriculture sector. The Agricultural Productivity and Diversification Project began on March 22, 2011, with a budget of $61 million and ends on February 28, 2021. Its purpose is to repair major damage caused during Benin’s 2010 flood and improve productivity in certain export-oriented value chains, such as aquaculture, maize, rice, cashew and pineapple.

One component of this project is improving technology and restoration of productivity. The devastating flood in 2010 destroyed over 316,000 acres of cropland and 50,000 homes. The project began after the major flood and takes into account the need for drainage systems to stifle rising waters during floods. Small-scale irrigation infrastructure repair and improvement are issues that the project faces and hopes to correct in the timeframe. Climate-smart production systems are another investment that the country is developing to prevent widespread destruction to cropland when a natural disaster threatens to destroy homes and crops. The project is also set to create new jobs by investing in small and medium enterprises (SMEs), especially for youth and women.

Improving the Business Environment

Although flooding caused several Beninese people to lose their homes and cropland, there is one impediment that halts economic development: corruption. President Talon became the President of Benin in 2016 and stated in his inaugural address that he would “make the fight against corruption an ongoing and everyday struggle.” A 29 percent electricity access is another issue that prevents developmental progress in Benin, but since 2016 blackouts have reduced and electricity generation has improved significantly.

Economic Diversification

The last major impasse that prevents development in Benin is over-reliance in Nigeria, Benin’s major exporter. Current IMF Managing Director, Christine Lagarde, announced a call for economic diversification in Benin. Lagarde believes diversifying is one way to reduce the high poverty level of 36 percent. Due to the country’s economic reliance on the agricultural sector and economic conditions in Nigeria, it is difficult to grow if a recession, such as the 2017 recession in Nigeria, occurs. In her speech at the Chamber of Commerce in Cotonou, Benin, Lagarde discussed how Benin could strengthen land tenure, increase food security in rural areas and invest more in education and health, and improve transparency in the government so that outside investors would find investing in Benin appealing.

Rate of Progress in Benin

There is room for growth, though the poverty-stricken nation has had success in certain areas, such as the average life expectancy that rose from 50 years in 2000 to 62 in 2018. With the creation of the Agricultural Productivity and Diversification Project, improvements in agriculture and infrastructure are already underway. The estimated rate of urbanization is fairly high at 3.89 percent from 2015 to 2020. At this rate of progress in Benin and under the leadership of President Talon, the country will continue its headway in development so that the percentage of Beninese in poverty will gradually drop in the coming years.

– Lucas Schmidt
Photo: Flickr

Media Misrepresents India
India is a vast South Asian country, not only with diverse terrain stretching from the Himalayas to the Indian Ocean Coastline but also with significant socio-economic contrasts. It is understandable how the media misrepresents India because it tends to shed light only on the rural and urban poor and the struggling.

With a population of more than 1.3 billion, there are stories of unfortunate and inhuman events that occur in the country but those events don’t represent India, as a whole. India needs to be looked at through fresh lenses to dispel the following ideas.

How the Media Misrepresents India

  1. Poor India: India is a developing country with 22 percent of its population living in poverty, but only about 5 percent of the Indian population lives in slums. The International Monetary Fund confirmed that India will be the fastest-growing major economy with a growth rate of 7.4 to 7.8 percent in 2019. In terms of GDP, India is now the world’s sixth-largest economy. 
  2. Uneducated Nation: This is another example of how the media misrepresents India, as an uneducated country. India has more than 1.5 million schools with more than 260 million students. Currently, India produces about 9 million graduates and 26.5 million students enrolled in Indian higher education per year. The country is set to produce the world’s largest number of engineers. The first ever Global Report commissioned by the Queen Elizabeth Prize has revealed that 80 percent of Indians aged 16 and 17 have shown interest in engineering, compared to 30 percent in the U.S. and 20 percent in the U.K.India is also the only country after the U.S. and Japan to build a supercomputer independently. Indian Space Research Organization (ISRO) also became the first country to orbit around Mars on its first attempt at a cost of just $74 million, which is just a fraction of what other nations have spent.  
  3. Dirty and chaotic: The media overlooks the fact that the country has luxury malls and hotels too. The number of malls has increased drastically in the past few years. With no malls in 2002 to 308 malls in 2017, India has improved a lot. The Government is also taking various actions like Swachh Bharat to bring out a better and clean India.
  4. Bollywood is a Zumba class: The Indian film industry is actually the largest film industry in the world, releasing more than 1,000 films each year. In 2015, there were two thousand multiplex theaters and the following year, 2.2 billion movie tickets were sold, which makes the country the leading film market in the entire world. Indian movies are not Hindi movies alone, but a variety made in different states and in different regional languages.

These are just a few examples of how the media misrepresents India. Hopefully, in the coming years, the media will shed more light on the brighter side of the country.

– Shweta Roy
Photo: Flickr

International Monetary Fund Facts
The International Monetary Fund (IMF), in combination with the World Bank, is the world’s largest public lender today.

Key Facts About the International Monetary Fund

 

  1. In the 1930’s the world was overtaken with financial turmoil from the Great Depression. Markets all over the world collapsed and countries closed their doors to foreign imports. The IMF was conceived in July 1944 at the United Nations Bretton Woods Conference in New Hampshire, to protect the world from a similar blow and hasten financial recovery in war-torn nations.
  2. The Fund was created to act as a credit union and watch over the values of the world’s currency, while facilitating International Trade, promote employment and sustainable growth and help to reduce global poverty. Its main aim is to maintain economic stability and help countries complete financial transactions.
  3. The three main responsibilities of the IMF are: Surveillance — specifically to monitor the economic and financial policies of its members; financial assistance through loans to its members experiencing balance of payments issues; and technical assistance to help members design and implement economic policies that foster stability and growth.
  4. Primary aims of the IMF: Promote international monetary cooperation, facilitate the expansion and balanced growth of international trade, promote exchange stability, assist in the establishment of a multilateral system of payments and make resources available to members experiencing balance of payment difficulties.
  5. The IMF is accountable to 189 member countries. Its Headquarters is located in Washington D.C.
  6. A country’s voting power is based on the size of its economy and the amount of the quota it pays when it joins the IMF. The U.S. has the largest share of votes (approximately 17 percent). Decisions require a supermajority– 85 percent of votes.
  7. The IMF advocates currency devaluation for governments of poor nations with struggling economies.
  8.  The largest borrowers of the IMF are Portugal, Greece, Ukraine, and Pakistan. The largest number of IMF loans have gone to the African Continent.
  9. The U.S. contributes about 20 percent of the total annual IMF Budget. The largest member of the IMF is the U.S. while the smallest member is Tuvalu.
  10. The fiscal year for the IMF begins on May 1 and ends on April 30.
  11. The head of the IMF staff is the Managing Director. The Managing Director also acts as Chairman of the Executive Board and serves a five-year term. The present Managing Director is Christine Lagarde of France. The Executive Board Members monitor the day to day work with the guidance of the International Monetary and Financial Committee.

Studies show that contrary to the criticism of the IMF, it fulfills its functions of promoting exchange rate stability and helping its members correct macroeconomic imbalances.

Aishwarya Bansal

Photo: Flickr


Egypt’s poorest and most vulnerable people are receiving special care. This is the result of the country’s fundamental economic reforms, made possible with the help of a $12 billion loan from the International Monetary Fund (IMF). Egypt’s economic reforms are creating some short-term difficulties, including high inflation, but ultimately should lead to greater growth and more jobs for the nation.

The reforms are intended to solve long-term economic challenges in Egypt. The challenges include an overvalued exchange rate, large deficits in the Egyptian budget, high unemployment, and slow growth. To address these challenges, Egypt’s government is pursuing economic reforms including a floating exchange rate, a value added tax (VAT) and a reduction of fuel subsidies.

Egypt’s economic reforms should produce long-term benefits for the country, in particular, increasing economic growth and job creation. They should also help limit inflation to single digits.

As anticipated by the government, the reforms are creating immediate challenges for Egypt’s businesses and consumers. Businesses are feeling the effects of the Egyptian pound’s devaluation as production costs have risen sharply. Consumers are being hit with a spike in short-term inflation, along with the new VAT.

Helped by the IMF loan, the government is taking steps to mitigate these short-term effects on Egypt’s poor and vulnerable populations, especially women and children. The Egyptian government has committed to spending an additional percentage point of its GDP — about 33 billion Egyptian pounds — on programs for the poor and vulnerable.

These funds will be used to increase food subsidies, provide for cash transfers to low-income families and the elderly and other targeted social programs. These additional social programs include free school meals, vocational training for youth, and support for children’s medicines and infant milk. Additionally, the government will provide gas connections in poor districts.

As the IMF points out, the government intends for Egypt’s economic reforms to benefit all the people of Egypt. The reforms will cause some short-term disruption and difficulties to them, especially the poor and vulnerable. However, the government is addressing those difficulties by strengthening the country’s social safety net so all Egyptian citizens can make the transition to a better life.

Robert Cornet

Photo: Flickr

Sarah Emerson is the Director of Women Empowered Initiative at PCI Global and is the driving force behind the idea that women’s participation in the global economy can allow them to live up to their full economic and social potential while reducing global poverty.

According to the International Monetary Fund (IMF), more than 27 percent of the gross domestic product in developing countries is lost each year due to women being denied entry into the global economy.

Women like Emerson are driving change while empowering other women to do the same. These women are lifting their families out of poverty and transforming businesses and economies around the world.

Reducing Poverty Worldwide

The initiative has been a mechanism for empowering over 400,000 women around the world to pool their resources and become active participants in their communities while addressing food insecurity and reducing the impact of poverty. It is funded in part by USAID and focuses on self-sustaining women’s savings groups by building self-worth and not just capital. The initiative also builds leadership skills like goal setting, action planning and decision making about investments. These skills allow women to take the lead in the most important areas of their lives.

PCI Global believes that women are the solution to poverty and have the ability to bring about economic and social change to transform the lives of those living in extreme poverty.

Emerson continues to bring change to poverty, while addressing many other economic issues, through her campaigns and future development programs launched all over the world, including San Diego. San Diego is the home for many former refugees, resettled by the U.S. State Department, who need further aid to lift them out of poverty.

PCI Global focuses on women located on the Pacific coast of California who struggle with meeting the basic needs for survival. It also provides empowerment opportunities to low-income ethnic groups who require food, housing and access to medical care to create better standards of living.

PCI Global believes that the initiative has the trajectory to bring change to poverty, one woman and one community at a time.

Rochelle R. Dean

Photo: Flickr

ukraine
This past March, Ukrainian Finance Minister Natalie Jaresko and Prime Minister Arseny Yatseniuk succeeded in securing an impressive amount of aid from the International Monetary Fund, but their work to bring Ukraine to financial stability has only just begun. The restructuring that the IMF and Ukraine agreed on calls for Ukraine to save $15.3 billion over the next four years, a number that would only be attainable if some of Ukraine’s creditors forgave a portion of their principle. So far, nobody seems willing.

After the violence last year sent Ukraine’s economy into a tailspin of high interest rates and dwindling federal bank reserves, the international community stepped in to lend Ukraine a hand – and several billion dollars.

Last April, the IMF approved a two-year loan of $17 billion to Ukraine, but soon deemed the plan insufficient to build reform while the government was busy fighting pro-Russia separatists in eastern Ukraine.

This March, the IMF approved a loan that would deliver $17.5 billion over the next four years, with $10 billion of the money being delivered this year. An official statement by IMF Managing Director Christine Lagarde in Berlin called the program “very strongly front-loaded during the first year.” She went on to express optimism about the plan, saying, “Ukraine has satisfied all the prior actions that were expected and required of it in order to start running the program. … We are off to a good start.”

‘Front-heavy’ loans like this are supposed to kick-start the rebuilding process and bring faltering economies out of their downward spirals. That money was combined with an additional promise of $7.5 billion from other international organizations and an expected $15.3 billion in debt relief.

Even with this assistance and the optimism of the IMF, the Ukrainian economy is expected to contract by 5.5 percent in 2015, before rebounding and growing by an estimated two percent in 2016. While the outlook of the IMF and the Ukrainian government is cautiously optimistic, their goal remains lofty. By 2020, they aim to reduce Ukraine’s debt down to $56.1 billion, from the estimated debt in 2015 of $74.9 billion.

Ukraine’s debt can be broken into four very rough categories: there is debt to international organizations like the IMF, which is unlikely to change. There is debt to friendly governments like the United States, which would also be hard to change. The remaining two kinds of debt are Ukraine’s $17.3 billion in sovereign Eurobonds and $31.4 billion in domestic debt. These are the debts the Ukrainian government has the best chance of re-negotiating, but simple interest alterations won’t be enough. To meet its goal, the Ukrainian government will have to reduce the principle of these debts.

This will not be a task for the faint of heart. The largest private bondholder, asset management company Franklin Templeton, has hired heavy-hitting consulting group Blackstone to advise them during talks, a sure sign that they don’t plan to surrender much. However, the toughest creditor is probably Russia, who holds $3 billion of Ukraine’s Eurobond debt, and has proven intractable to negotiation about restructuring so far.

If Prime Minister Yatseniuk and Finance Minister Jaresko can negotiate a manageable plan for debt repayment, Ukraine’s economy has the potential to make an impressive comeback.

– Marina Middleton

Sources: IMF, Bloomberg 1, Bloomberg 2, Reuters
Photo: Flickr

The European Union has been struggling to lift itself out of an eight-year economic crisis and the end of 2014 proved no different. After teetering back and forth for several months, EU stocks rose steadily for a period of four days last December, during which they reached their highest levels since November 2011.

Unfortunately, this short uptick failed to last and the Eurozone market slunk back on a downward trajectory.

However, despite the ongoing crisis, Germany shows its resilience to the debt crisis over and over again. Unemployment decreased and is at its all-time-lowest rate of 6.5 percent. “The labor market has developed in a positive direction, despite weak economic incentives,” said labor office President Frank-Jürgen Weise.

Germany’s situation is markedly better than Greece’s economy. Greece’s unemployment rate sits at just over 25 percent of the population. The International Monetary Fund implemented heavy austerity measures after a recent economic bailout, and Greece is expected to leave the euro behind sooner rather than later.

If a new government is elected and Greece decides to exit from the euro, the currency would be expected to take yet another hit. Currently, the economy in Greece is Europe’s most regulated due to the strict austerity measures implemented by the IMF and World Bank.

In Europe, the common market currency has fallen to its lowest value against the dollar since 2006. As a result, the overall unemployment rate in the EU settles at around 11.5 percent with youth unemployment at 23.7 percent.

With the economies in Europe beginning to stabilize, countries are more likely to leave the single currency and explore other alternatives. This could further destabilize the euro and throw the Eurozone into another crisis. Even so, Germany’s growth provides a glimmer of hope to Europe’s uncertain economic situation.

Maxine Gordon

Sources: Taipei Times, DW Germany, Trading Economics, Bloomberg View, Business Insider, The Guardian
Photo: Express