The challenges of the 'New Global Economy' - speech by Andrew Sentance

In a speech to the Jersey Chamber of Commerce, Andrew Sentance – External Member of the Monetary Policy Committee – describes the way in which the global economy has become more integrated and interdependent, and the challenges those changes pose, including for the MPC.
Published on 25 May 2011

“Four main forces have come together in the past two decades to create the ‘New Global Economy’ of the 21st Century”, Andrew Sentance says. “First, new technologies have had a major impact, notably the development of global information technology, media and communications networks. Second, barriers to trade have been reduced, with most of the world’s nations now participating in a liberal and open trading system”. “Third, political change has extended the global market economy to large parts of the world which were previously closed to international trade and investment... And fourth, there has been a tide of deregulation of markets – including financial markets – in many countries, and as markets have been deregulated, they have also been opened up to international competition.” He goes on to discuss the challenges these factors pose, and in particular: “how can economic policy-makers maintain stability when we are constantly in danger of being buffeted by powerful global economic forces?”.

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