James Baldwin: check the policy of reform and economic stability

8/31/2015 0:00

BAGHDAD - Imad Emirate
Said an economic expert d. Wafa James Baldwin: that the process of economic reform requires the restructuring of the economy in the medium and long-term ranges of time, dependent on declining role of the state in economic life to the lowest possible point.

She said in an interview for »Sabah» that means expanding the application of the privatization program to include most government projects, as well as to make the market standards and mechanisms of the foundation in the allocation of economic resources will require the selection of investment opportunities that have high revenue, which will accelerate the growth rates among the productive sectors towards incentives change structural. And it showed: this response vary depending on the level of economic development and the effectiveness of the market in the allocation of resources more advanced stages of development and growth increased market power effects in the allocation of resources, noting that the slowdown or acceleration in structural changes of the economies of the trans does not depend on the local implications only, but shared by the external implications, including conducting those economies to equilibrium conditions.

Public expenditure

James Baldwin pointed out that this ideal situation can not be found in the application because of internal restrictions and other external contributing to imbalances and generate side effects is desired, the policies of the application, which seeks to reduce public spending and reducing aggregate demand and the resulting increase in the unemployment rate and poverty are difficult to manage Stimulate the economies of the display.

He continued: If the question of production efficiency to be achieved as a result of structural changes will enable the export rate of increase, assuming flexible production system and its ability to achieve the increase in exports, but the downturn will happen in the short term as a result of activation of demand measures will slow down the domestic supply of goods and services, causing an imbalance between effective demand management and enablers oversupply, Veptad economy on the state of balance and this will inevitably result will result in a decline in the ability to provide basic needs and the increasing incidence of poverty and misery in society and in the short term
Say the least.

Overcome the negatives

She d. James Baldwin, but many of the options began to impose themselves and strongly toward cons exceeded this point emphasized by the World Bank in particular, and perhaps the expansion of privatization and total liberalization of foreign trade applications in order to reach a convergence of the relative relations of prices in the local market with their counterparts in the global market is of the most prominent options that will enable the economies of transition countries from the face of internal and external shocks efficiently. And it went on by saying aiming reform policy to achieve economic stability at the macro level and in the short term through a package capable of containing internal and external, and particularly economic imbalances administration policies with deflationary and rapid effects of aggregate demand towards reducing the overall level of demand policies interaction and through the interaction of each of the fiscal policy and nutrition and recent exchange rate policy and this occupies the first place in terms of the effectiveness effect in achieving the goal of stability to this stage.

Privatization programs

He concluded by saying that the beginnings of this stage we impose the adoption of a fixed exchange rate unified policy is linked to the process of President as dollar or the mark in order to rein in inflation, which took rates increasing because of the liberalization of prices, as well as his role in organizing Alasaralhakiqih paid to direct producers, in addition to the organization of the real value of salaries , In fact, the significant decline in the value of the currency because of high prices would lead to a significant decline in the real income of the state, paving the start implementing privatization programs but on a small scale and unconditional.