03-12-2009, 01:54 AM
In my view, UAE and other Gulf countries which are unable to retain population would be effected more as compared to Pakistan, USA or any other country. If the people leaving country in result of losing jobs, then where consumption spending would go that supports economic activity, both in short and long-run, and is much needed to come out of recession and for recovery. Market support through cousumers spending, and resulting business profits would be at their minimum. Just to understand this phenomena, imagine about extreme hypothetical situation in which no market sentiments or market itself would remain existant if their are not enough buyers. Their malls, shopping plazas, entertainment centres could be deserted place if they would not have enough consumers to buy. Same negative impact would be on services sector.
In any case, these countries would have more negative multiplier effects on economy as compared to Pakistan or any other country where at-least their population remain there in recession and support market mechanism through daily necessary expenses.
I think, their labour laws and policies have back lash effect. It is the time for those governments (like UAE) to keep population inside the country through change in policies and government spendings.
Interesting thing is, Arab money is being kept in foreign countries for decades, and channeling back as foreign investment. Now, they are dependent on this foreign investment.
In any case, these countries would have more negative multiplier effects on economy as compared to Pakistan or any other country where at-least their population remain there in recession and support market mechanism through daily necessary expenses.
I think, their labour laws and policies have back lash effect. It is the time for those governments (like UAE) to keep population inside the country through change in policies and government spendings.
Interesting thing is, Arab money is being kept in foreign countries for decades, and channeling back as foreign investment. Now, they are dependent on this foreign investment.
