Proceedings of 8th Asian Business Research Conference
1 - 2 April 2013, Bangkok, Thailand, ISBN: 978-1-922069-20-7
Overcoming the Economic Global Crisis with United of Asia
Muhammad Erfan Huda
Economics is one sign of the quality of the State, the country's most crucial
aspect, one of the aspects that have great influence and complicated, and one of
the aspects that can make the country prosperous. The world economic crisis has
started, various parts of the world experiencing economic failure in the financial
sector, banking, to the management of resources. All States have hope can fix
the economy in the future, because for the sake of the survival of our offspring
well-being.
The world is now facing an economic crisis of a sector of a superpower with
the economic picture quality in the past which is very good. United of Europe is
one of the sectors of the superpower that was merged into a single entity with the
economic system and the same currency to any broader power of its members.
However, European Union now are in trouble because of the crisis, the fifth
member of the year 2008, and recently open in late 2012.
These problems can affect the livelihoods of people who depend on them as
is the case in Asia, many Asian countries that depend on the US and Europe.
Starting from investment, export/import,and cases of debt investments. It seems,
we are as one of Asia's population should be aware that, if we do not change our
country's system of each in the future all the countries in the world are
experiencing a crisis due to suspended each other each other.
Therefore, I created the theory of the United of Asia a breakthrough that was
made from a group of other countries such as ASEAN and United of Europe. This
will help the survival of their respective countries in Asia to have a tendency of
the continent of Asia 3 countries will be comes the future Superpower
Keywords : European Economics Crisis, USA Fiscal Cliff, Rippled Global Crisis
Chapter I: Introduction
a. Background
As time goes by, year after year, the world is getting hot and old. Various parts of the
world have experienced the changing dynamics of the economic, social, and political. Many
countries that have positions as SuperPower, got a nickname like that because they are able
to make a good attempt, neat, and capable of contributing to the well-being of its people as
well as other countries in need. However, the country's Superpower in the 21st century
experience should turn post 22 to another country, through to the end of the world countries
vying for the expansion of all forms to make his country much more advanced than the
country's Superpower.
The economic crisis is the near-near has seized public attention especially the principals
of Economics, economists, experts and others. As a result of the economic crises in different
parts of the world can cause more severe situations in surrounding countries in desperate
need or strongly tied with the economic crisis-producing countries. This is where we as a
society of Asia should be able to anticipate any more severe events when we are still
dependent on those countries. Unity is the best way to avoid the crisis that will propagate to
other parts of the country, where ideology must be identified and well being should be leveled.
_______________________________________________
Muhammad Erfan Huda, Student Faculty of Economics and Business, University of Brawijaya – Indonesia
Proceedings of 8th Asian Business Research Conference
1 - 2 April 2013, Bangkok, Thailand, ISBN: 978-1-922069-20-7
In addition, unity can make people's lives more peaceful and safer due to one thinking in
analyzing the problems surrounding them. So the need for changes in Asia in order to
become a more prosperous life. Do you remember you when the crisis of 1980, in which
countries supply oil crushed due to a war brought about by Western countries? Where our
weaknesses, and so neighbours our country himself was forgotten, when the oil-producing
countries have 32 countries that depend on it. Supposedly, the Asian community could be
tolerant and mutually help each other to the next door neighbor because we are one region.
From this emerged an idea to unite in avoiding economic crises in the future, so that
people in countries in Asia may become a Superpower country that is able to supply a lot of
resources to countries that have long since we experience dependency.
b. Problem Formulation
United began the destruction of Europe showed its economy from a total State debt of
several countries mentioned because they don't do the opening to other countries. This is
exacerbated because of the many that happened because of scarcity of natural resources
and their human resources, proven in the last years many people from some countries that
are experiencing the crisis has got their base salary cuts of 40%, it is certainly not natural for
them, suppose that at first they get net income amounting to one million and cut 40% will be
six hundred thousand per month. There was even a country because they get a high debt,
they provide income to its people in a period of 3 months. This will aggravate in the center of
the organization does not provide a way out together.
Yet coupled with the crisis in the American system, the failure of natural capitalism run
by the United Nations. The injected funds amounting to 700 billion wouldn't make a solution
for the United State which initially referred to as the fiscal abyss. The fiscal chasm of debt
management is America Problem. The Ministry of Finance of the United State's debt limit so
reminiscent of SuperPower that does not exceed USD 16.4 trillion in order not to go bankrupt.
When that happens, 88 percent of Americans will taking a tax increase, so that the country
would experience a recession.
c. Intents and Purpose
In this paper i made for the survival of the asian communities will face in the global crisis
experienced by europe and america spread
When this occurs we strive to avoid such things in advance using the concept of
socialism economy together.
Chapter 2: Discussion
Europe
The economy of United Europe fell due to 4 Member States called PIGGS (Portugal,
Ireland, Greece, Spain) who have the economic crisis is too severe. Greece was the first
country that showed its economy due to the destruction of the average GDP deficit reached
6% over the last 30 years with GDP figures showed last USD 298,73 billion. Currently, in
2013 the deficit country Greece rose to 13.5% of GDP country Greece and Greece isn't as
bad, more open to economic crisis to other European countries.
Proceedings of 8th Asian Business Research Conference
1 - 2 April 2013, Bangkok, Thailand, ISBN: 978-1-922069-20-7
Portugal, Portugese interest rates haven’t come down. Because of the Greek crisis, bond
yields rose to dangerous levels in several financially troubled European countries. Then after
Greece was bailed out, yields fell in most of them. In Italy, yields on bonds with maturities of
around 10 years dropped from more than 7.2% to around 5%; in Spain, from 6.7% to 5.4%;
and in Ireland, from 9.7% to 6.9%. The notable exception was Portugal, where bond yields
came down a bit but still remain above 12%. Double-digit borrowing costs are impossible for a
heavily indebted country to sustain for any significant period of time. Yet Portugal’s bond
yields have been above 10% for the past nine months.
Irish economy entered severe recession in 2008. Ireland entered into an economic
depression in 2009. The Economic and Social Research Institute predicted an economic
contraction of 14% by 2010. In the first quarter in 2009, GDP was down 8.5% from the same
quarter the previous year, and GNP down 12%. Unemployment is up 8.75% to 11.4%.The
economy exited recession in the third quarter of 2009, with GDP growing by 0.3% in the
quarter, but GNP continued to contract, by 1.4%. The economy grew by 1.9% in Q1 and by
1.6% in Q2 of 2011 but contracted by 1.9% in Q3. The unemployment rate rose from 4.2% in
2007 to reach 14.6% as of February 2012. Unemployment rates about 130.6 percent (take
from those crisis-trigger countries) with 60% on youth-unemployment. Total Debt are higher
than its GDP, in average more than 100% from GDP
United States of America
What is Fiscal Gap? The magnitude of the base budget surplus (expressed as a
percentage of GDP per cent/) needed to achieve fiscal sustainability with the compliance with
the requirements of direct that national debt is maintained at or below the existing percentage
of GDP.
If the fiscal precipice turns out to actually occur, its impact to the US economy will be
very dramatic. A combination of tax increases and budget tightening will indeed lower the
deficit to approximately 560 billion dollars, but it will also lead to GDP in the u.s. decreased by
4% in 2013. With slashing GDP by 4% this means that the US economy will go into recession.
At the same time, these conditions will also result in a rise in the unemployment rate,
which is forecast to increase by 1% from the current. This means about 2 million people would
lose his job.
Which is more dangerous a fiscal abyss again, although this has not occurred, but if the
Government Obama cannot come to an agreement in writing to ensure that this would not be
the case, then the uncertainty itself can already lead to recession. In the absence of certainty
to businesses and households will make changes to expenditure in order to anticipate the
worst. With this condition the possibility in the last quarter of 2012 u.s. economy will already
be experiencing negative growth.
The Impact to Asia
In other hands, Asia as well-continent has a big potential to take risk of this global
conidition, more than 10 countries in Asia has a high dependency with the crisis countries,
likes Spain, Italy, America, and Germany. Whereas, in average more than 30% of our exportimport activities depends on those countries, if the related countries give a high-tariff to
destination country, the consumer will be goes down and when it will happened all sectors in
both relations countries will get a loss.
The Advantage for Asia Countries:
Proceedings of 8th Asian Business Research Conference
1 - 2 April 2013, Bangkok, Thailand, ISBN: 978-1-922069-20-7
1. For developing countries will experience rapid economic growth since the world's
largest market (developed countries) is undergoing a crisis, in the sense Of the
Market has been closed is likely to hinder the growth of developed countries
2. The increasing foreign investment to developing countries because of the
destruction of trust investors against countries affected by crisis
3. The increasing surplus of developing countries because of the many requests from
foreign countries are not tied to the developed countries.
The Disadvantage for Asia Countries:
1. The fall of the big companies that increase the activity of import-export to the
developed countries that are experiencing a crisis, due to the decline of demand
against supply.
2. The economy of developing countries will be threatened by the existence of a fiscal
abyss that would spread because accounts receivable from related countries will
experience a long overdue.
3. Developed countries affected by crisis investing to the developing world will be
very dependent and threatened if they were wild, resources will be spent gradually
due to the scarcity.
Formula Solutions
Petroleum, Saudi Arabia became the first country to ranked oil producer in the world by
number of production 10.520.000 barrels per day. So did Russia, Iran country, Indonesia,
China, the United Arab Emirates, Iraq, Kuwait, and Qatar.
Petroleum, Indonesia has a "black gold" is quite a lot compared to other countries in
Southeast Asia. Indonesia's oil production currently total per day can reach 912.899 barrels
per day (crude oil + condensate).
Gold, indonesia is also an important manufacturer for the world. 100 tons of gold
produced in 2009, an increase of 66 percent compared to 2008 and down 11 percent
compared to 2001. China, Beijing, (Analysis). According to data announced the China Gold
Association recently, China's gold production results in 2012 reach 403,05 tons, becoming the
largest gold producing countries for six consecutive years. While gold consumption reached
832,18 tons, became the country's gold consumption is second in the world after India.
Compared to the year 2011, gold consumption in China increased by 9,35 tonnes, up 71,13
percent.(cri).
And other mining materials such as silver, coal, forestry, and the other 60% is still
dominated by Asia. Countries in Asia have the level of mining and plantations are very much
and varied, the continent that has a wide variety of production and the uniqueness of each
negara-negaranya.
Of the three Asian continent above, privilege be created a Roster of Asia, which will
change the lives of the people of Asia are becoming more prosperous for being one. United of
Asia will be established through membership of 50 Asian countries and of course is already
registered in a Member State. In the United ketataan organization of Asia, it will build a group
of sovereign States and prosper every country in Asia, through the help of the economic,
social, and political cooperative as arranged in the form in order to avoid an economic crisis in
the world. Countries in Asia depends not only with countries outside Asia that on average are
the developed countries, so that they too are bound by outside countries. United of Asia into a
solution of 50 countries in Asia as an economic centre in the Asian continent, forming a giant
organization structure that governs the policies of economic, social, and political.
Proceedings of 8th Asian Business Research Conference
1 - 2 April 2013, Bangkok, Thailand, ISBN: 978-1-922069-20-7
By building a United Organization of Asia, countries that still depend heavily importexport activities, investments, loans and foreign debt of the country outside of Asia should be
immediately disconnected or cut down. Because at United of Asia we will make a monetary
and financial system altogether, by creating a loan and debt capital to boost economic growth
in Asian countries dimasing-masing.
Based on the data, local consumption down to the lowest position in 45% of the GDP of
developing countries of Asia in 2010 – down 10 per cent compared to 2002, points and also
state China become the holder of an important role in supplying the needs of consumers in
Asia. 5th annual plan (2011-15). This indicates that Asian countries were already highly
potent once to make a unity with an Oau Diplomacy, because we have millions of natural
resources, ranging from petroleum, forestry, mining, fisheries, Technology Development, and
others.
If this concept starts I believe that will happen and the equitable distribution of growth
countries will progress to its full potential in Asia. The Union can make a significant role in a
change in the future.
d. Closing
As the people of Asia, I would to invite the whole of each countries to make a agreement,
that we have to consider ourselves into the part of its performance. As long as we still have a
continent with its own specific diversity, let's make the countries in asia are subject only to the
countries of asia, such as e.g. the activities of buying and selling of natural resources in
countries in asia, do not depend on other continents except asia. Because it would trigger a
crisis that propagate to our respective countries, i as a student can see a situation that is
going to come where we are still subject to countries outside asia.
Thanks for your attention