Topic: What brings economy of a country down. - page 7. (Read 1685 times)

In the current situation, covid-19 has brought our world economy down and this a biggest downfall we have encountered this year wherein every countries are striving hard to stand up and fix everything as soon as possible. As the moment of this pandemic everybody lost their job and many companies closes down because of the scare of the virus. Just by this scare, every economy literally down and no one knows when this will end not unless vacinne is available.

This is just a simple cycle of how the economy works in every country
- people work, people have salary.
- they will use their salary to buy some things.
- they are helping the economy thru spending their salary.

Its just the simplified cycle of how the economy works but there are some things that can be added there.
Right now, people can't work because of the pandemic and since people can't work they doesn't have any salary to spend on their everyday lives. Because of this, they can't pay tax that can be used by people in different things and also they can't contribute to the economy since they have nothing to spend on.

This is the same thing that’s happening with some countries, especially in the developing countries. Some countries neglect other things they can do and only focus on one particular thing that is giving them money, maybe like Oil, and they forget that they should be putting effort towards making other areas/sectors better to help their economy.

Instead of focusing on one thing, they should be looking into other things as well, just like agriculture and invest in their local farmers and try to most of the things they have to import, that way they will reduce their import and increase their export. In cases like these, it’s mostly the government that are to be blamed, because they don’t do the right thing by showing support to people in those particular areas.

Usually, a virus and a recession in a country cause a country's economy to go down COVID 19 closes everything due to trade with one country stops trade with another country the country's economy is disrupted and the economic downturn occurs. Everything from import to export remains closed The economy goes down because no one can provide money in any sector at the right time.

Yeah but the government backing a patricular sector needs to come from somewhere. Either they take away funding from a different sector, for example freezing in the pension payouts for sometime while increasing social welfare spending. But this will most of the time not really help, just shifting the problem from part of the country to another.

The other way of the government to support their country would be to print new money. But then internationally the value of the currency will start to decline making it worth for any imports. It's very hard to support your economy and still remain competitive in the long run.

As  for giving out new debt, it always needs someone to buy that debt. And if the hole world is in crisis mode, it might be particular difficult to raise new funds.

Just by giving the recent effects of the pandemic, an economy of a country goes down when its GDP, Income, employment, production and the like goes down/stops. Basically, if businesses fail at employing what they should be doing, giving income, receiving income, producing products, accepting employees, etc., you can consider the economy of a country to go down. Ofc, that is considering, a majority of the businesses in a single country fails to do so. Just like in the recent pandemic, it's not like they failed to do so, it's that they had no choice but fail.

Just like his example, some countries depend on oil and hence, that country provides income for their own country by selling it to others. But imagine if they stopped because of external reasons, it's not only their business that would go down, but also the economy of the country because the profit that enters through them went down the drain.

If the country is under the pandemic means the economy of this are not good well. But if the government gives some mandatory to their people , government can open an establishment that need in this situation. Like groceries , pharmacies and many more that can help to rise economy that can help to maintain not as big but good to the government . But we know that is not an easy to the government to back the good economy under pandemic.

Third world economies are usually focused on selling and exporting one product.
What can bring down the economy of advanced countries:
1.Wrong monetary and fiscal policy by the government,which creates budget deficits and hyperinflation,which might lead to the country's bankruptcy.
2.If the country exports a lot of goods to other countries and they stop buying those goods.
3.Creating bubbles in the financial markets of that country that might burst and create financial panic.This has something to do with the monetary policy,money printing and regulations over the financial sector.
4.Wars and natural disasters....

Covid19 definitely can bring economy of some countries down due to how industrialized that particular country is.
Some many countries don't depend on oil but them keep on surviving why because they have objective that will make the not to regret in their economy.

When it comes to economic shutdown or plummet, there are a lot of factors. There are signs that an economy is plummeting, one is its contant negative GDP growth, this means that companies are lowering there expenses there fore laying off workers which in turn makes a low currency circulation thus reduced GDP growth, overextension in credit can cause recession because they are using government fund and the slow repay of this credit back to the state causes reduction in economy circulation, creation of artificial increase in interest rate can cause recession. With regards to the quote above, simply investing to sector doesn't aid or prevent a economic plummet, well management of financial reserves and upholding a good financial policy will help a lot because this prevents banks from creating a bubble that only will benefit few people in the long run.

Lets look at it from a different perspective as regardless of the government of a country diversifying her country's economy into different areas, they will still not yield a positive outcome if the government is been occupied by corrupt individuals. If you have studied the economy of most Africa country you can easily observed this statement above been very accurate.

The issue isn't that the countries aren't diversifying and investing into different sections of her economy but the corrupt politicians (only interested in enriching themselves) aren't ready for the progress of the country's conomy so as to keep the masses in poverty in other to win their votes when the next election approaches.

What brings the economy of a country down mostly have to do with the government of the day, as when the government lacks innovative minds in her cabinet to contribute ideas on how to improve the economy of her country, it bring the economy down. When corrupt politicians are withholding development so as to favour their selfish interest, it bring the economy down. I could go on and on but the point I'm trying to make is the economy of a country totally depends on the government as even the private sector tends to benefits when the government passes laws that encourages friendly environment for entrepreneurs to build on the workforce of a country.

I absolutely agree with the author. To boost the economy, it is necessary that some of its sectors begin to develop actively in place of collapsed sectors of the economy. And for this they must be sufficiently developed. Therefore, the state needs to invest money in various sectors in a timely manner. This must be done in order to avoid a fall in the economy during the global crisis.

I totally agree with you. A country or economy that doesn’t diversify their means of income is risking it’s self hugely. The world is moving very fast and technology has taken over it.
Other things that bring an economy down are
Corruption, mismanagement of wealth, Lack of resources.

From my point of view I captured that the country just focused on one sector leaving their initial revenue that brings income to the country.
So they focused on oil instead of agriculture which they started with,
And base on crude oil is in the market enough more than the way it's and it has no value like before automatically it brings the economy of the country down.
How assumed the way they started with agriculture they maintain the agricultural sector they would have lost their economy. So therefore both agriculture and crude oil suppose to be given attention because if this two sector that generate revenue for country operate the same time the country will be the best.
Shall in all ramification is mismanagement that caused everything.

There are several reasons why the economy of a country can go down. Its a very broad topic. The changes can happen due to change in aggregate demand and supply, wrong monetary policies and so on!

The "mentality" of the people shouldn't be blamed in this case! It is because of the government making bad fiscal policies that might have triggered people to store money as cash outside the bank. Proper policies and incentives taken by the government can encourage people to start investing their money on business and elsewhere.

The economy of a country also depends on the mentality of its people as well. For example, in my own country, lots people like to store the money as hard cash (not even in bank ) rather than spending it. So, a huge amount of money becomes stored which could be used for productive purposes. Thus despite of diversity, natural resources our country can not flourish economically.

Another will pick up which means they will start over again?
Ain't that the reason for a bad economy.
Instead of keeping what is already there, they will try to bring one down so another could flourish.

It will base on what a country can produce.
Imagine if the United States is producing rice in Nevada. Is that
Or in Amazon they produce metal.
So, how could you diversify if the land and resources cannot provide it?

COVID19 had brought country's economy down.  

Some countries are dependent on their oil exportation which their economy will run smoothly and some have a booming economy because they are heavily industrialized like China. Taking that out from them, then they'd be crippled. A city like Las Vegas' economy is dependent on tourism, due to Covid19, they are helpless which is why they have to make it work and open casinos despite the risk.

The economy is measured by gross domestic product. The economy of a particular region or country is governed by its culture, laws, history, and geography, among other factors, and it evolves due to necessity. Extended periods of sluggishness can easily lead into a recession, so a sluggish economy is often considered a leading indicator of a potentially steeper downturn

This is evident in Nigeria, prior to the discovery of oil (in 1953) agriculture was the main driver of the economy contributing hugely (more than half) to GDP growth and also export revenue.
The quest to discover oil in Nigeria began at the turn of the century and was very expensive, after it was discovered in 1953 in non-commercial quantities, over £6 million (£123 million in today's rate) had been spent on the quest, hence more effort and resources were engaged to accelerate the discovery of oil in commercial quantities, inorder to recover the lost funds, this was achieved few years later. After this, efforts were hastened to begin exploration later in that decade.

During all this, agriculture which was the was the core of the economy was beginning to be neglected and it's contributions to GDP growth began to drop, export revenue accrued from it was hit harder, as all efforts shifted to the liquid gold.

The discovery of oil however did not rescue the economy as many thought it would, mismanagement of the oil industry led to conflict in the oil producing states as the indigenes clamoured for better revenue to their zone. The oil drilling exercise destroyed the environment and fish market which was the main source of income among the locals was crippled due to oil spills. Conflict and militancy slowed down oil production and was a menace for many years. The agricultural industry was thus double affected by the discovery of oil as lands and vaible waters in those regions were lost.

Fast forward to today, agriculture barely contributes 5% to national export revenue, and the country's inflation index has spiked from the period before the discovery of oil to today reaching a height of about 2000%.
Crude oil failed to boost the economy due to mismanagement and corruption and the lack of attention to agriculture meant there was no diversification.

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With the Advent of electric cars and the quest for safer and renewable sources of energy which doesn't harn the environment, the oil market would likely drop in the next half a century, adversely affecting economies which are over reliant on it.