Trending Now
We have updated our Privacy Policy and Terms of Use for Eurasia Group and its affiliates, including GZERO Media, to clarify the types of data we collect, how we collect it, how we use data and with whom we share data. By using our website you consent to our Terms and Conditions and Privacy Policy, including the transfer of your personal data to the United States from your country of residence, and our use of cookies described in our Cookie Policy.
{{ subpage.title }}
Can Milei save Argentina's economy using "shock therapy"?
In an exclusive interview with Ian Bremmer for the latest episode of GZERO World, President Javier Milei acknowledges the severe economic crisis gripping Argentina. "Life is going to be harder for the average Argentinian citizen," he admits, underlining the difficult path ahead. Milei argues that his approach centers on transparency, a stark contrast to previous administrations. "Our approach was to always tell people the truth and to actually tell it like it is, saying that it wasn't going to be easy," he explains, emphasizing the need for honesty in these trying times.
As Milei puts it to Bremmer, his administration inherited a dire economic situation, with a staggering 17% double deficit in GDP and annual inflation soaring to an unimaginable 17,000%. "The solution inevitably had to be 'shock therapy,'" Milei states. He points out that incremental approaches have historically failed in Argentina, making shock therapy the only viable option. Despite the harshness of these measures, Milei believes they are crucial for long-term stability and growth.
Watch the full interview on GZERO World with Ian Bremmer, the award-winning weekly global affairs series, airing nationwide on US public television stations (check local listings).
New digital episodes of GZERO World are released every Monday on YouTube and on our website. Don’t miss an episode: subscribe to GZERO's YouTube channel and turn on notifications (🔔).
- Chainsaw cuts path to new Argentina-IMF deal ›
- Argentina's President Javier Milei wants his nation "on the side of liberal democracies" ›
- Milei makes fiery Davos debut ›
- The masses test Milei with major protest ›
- How Javier Milei is turning Argentina's economy around ›
- Is Milei moderating? Argentina’s president-elect takes power ›
- Who the heck is Javier Milei? ›
- Javier Milei's plan to save Argentina: Full interview - GZERO Media ›
Skyline von Bangkok Skyline von Bangkok. Panorama von Chinatown. Bangkok, Changwat Bangkok, Thailand, 26.01.2024
Thailand set to hand out $13 billion to citizens
Thai Prime Minister Srettha Thavisin announced Monday that citizens will be able to register for a digital wallet handout starting in August that will give about $275 each to 50 million people. It’s the latest in a series of populist policies put forward by the ruling Pheu Thai party, which cut a deal with the military to take power last year.
The idea is to offer folks an incentive to download the new digital wallet. Digital currencies are issued by a country’s central bank and function just like the fiat money you use every day. There are pilot programs in the EU, China, India, Saudi Arabia, and many other countries.
The government claims this handout, equivalent to roughly 66% of the average monthly income in Thailand, will help grow the economy by about 1.6%. The program is restricted to Thais who earn less than $23,000 a year (about three-quarters of the population) and they’ll have to spend it in small shops near their homes. But the Bank of Thailand has concerns – as do many economists, as it will push the debt-to-GPD ratio past 66% and increase the fiscal deficit.
That may be a risk Srettha is willing to run, considering his approval rate hovers around 12.85%. His efforts to pass popular policy, including a recriminalization of cannabis, and legalization of same-sex marriage, have done little to erase the stain Pheu Thai acquired by siding with the military to push out the Move Forward party, who won the largest share of seats in 2023. We are watching whether handing out cash can reverse his slide.FILE PHOTO: Indian Prime Minister Narendra Modi (2nd L) and his former Japanese counterpart Shinzo Abe (L) bow to national flags as they review an honor guard before their meeting at Abe's official residence in Tokyo, Japan November 11, 2016.
India’s rise makes Japan anxious
India is set to surpass Japan as the world's fourth-largest economy by 2025, earlier than previous forecasts. This marks Japan’s second year of decline in global GDP rankings, after falling from third to fourth place behind Germany in 2023.
According to the International Monetary Fund, India’s nominal GDP will top $4.34 trillion next year, slightly above Japan’s projected $4.31 trillion. The subcontinent’s GDP already overtook that of the United Kingdom in 2022 and grew by 7.8% in 2023.
India's economic ascent has been powered by strong domestic demand, as its population surpassed that of China last year. It experienceddouble-digit growth in its steel, cement, and automobile manufacturing sectors. India now uses its Rupee rather than the dollar for trading with 27 countries, and its 134 billion online transactions account for46% of all global digital payments.
In contrast, Japan's GDP growth lagged at 1.9% in 2023 after decades of stagnation, and the OECD projects an anemic 0.5% increase in 2024. Japan’s woes are exacerbated by its aging population, low productivity, and a stubbornly weak yen.
None of this is good news for the government of Japanese Prime Minister Fumio Kishida, amid a swirling party finance scandal and abysmal approval ratings. He’ll need to survive a leadership election in the fall for his Liberal Democratic Party, which will be looking for a leader to take them into national elections next year. With headlines like these, Kishida is expected to face defeat.Russian cosmonauts pose with a flag of the self-proclaimed Luhansk People's Republic at the International Space Station.
Hard Numbers: Russia quits ISS, Global GDP growth slows, Peruvians sour on Castillo, Lebanon buys wheat
24: After 24 years as a member of the International Space Station — a major step in post-Cold War reconciliation — Russia announced Tuesday it’ll leave the module by the end of 2024. But the US says it didn’t get the memo.
3.2: The IMF now says the world economy will grow only 3.2% this year, 0.4 percentage points less than it predicted in April. Meanwhile, global inflation will rise one percentage point more than expected to 8.3%.
19: Only 19% of Peruvians polled believe President Pedro Castillo is doing a good job one year after his election. He's already survived two impeachment votes, and Congress may try again soon over allegations that he obstructed justice by firing his interior minister.
150 million: Lebanon's parliament voted Tuesday to use a $150 million World Bank loan to buy enough wheat for at least six months. The cash-strapped nation is almost entirely reliant on imports to feed its population, and its food inflation rate was at 332.25% in June.Hard Numbers: GDP wars, WTO rules in Beijing’s favor, Africans support Chinese engagement, China winning 5G battle
5.9: China’s GDP could grow on average 5.9 percent per year until 2025, according to the Center for Economics and Business Research, which predicts that China will overtake the US as the world’s largest economy by the end of the decade. The Chinese economy was worth $18 trillion in 2021, compared to America’s $23 trillion.
645 million: Amid an ongoing trade war between the world’s top two economies, the World Trade Organization ruled last week that Beijing can slap $645 million worth of tariffs on US goods. A decade ago, the US placed tariffs on some Chinese products, including steel pipes and solar panels, saying that Beijing was giving unfair subsidies to state-owned companies.
59: The US has been trying to discredit China’s growing influence in Africa, but it’s not working: 59 percent of Africans view China’s economic and political clout favorably. Almost exactly the same number — 58 percent — feel the same about the US.
90: More than 90 countries have signed up to use 5G networks made by the Chinese telecom giant Huawei. Meanwhile, only eight nations have so far agreed to join the US ban on Huawei. Why? Many analysts say it’s because China offers way superior 5G infrastructure.
India gets biggest GDP downgrade by IMF as coronavirus lockdown bites
NEW DELHI (BLOOMBERG) - The International Monetary Fund's forecast for India's economy swung from expansion to contraction, marking the sharpest downgrade in projections of the world's main economies.