 After the 2006 rewind, it’s time to look ahead and make sense of the dominant global and national trends of 2006 — of how these would impact 2007 and beyond. Here is a collection of some distinguished prognosis for the new year.
LOOKING BACK AND looking ahead at the end and beginning of a year was never as engrossingly done as now. It reflects how much more complex the world has become in all spheres and the necessity to unravel the future and make sense from disparate and completely compartmentalized happenings. It matters more than ever to know where we are headed in a more composite way. Bearing this in mind, Team Merinews scourged sources to figure out what was going on in different domains to present fragments that put together bring out the future picture more appropriately — even if not fully — than a one-piece self-done article. This compilation made from news, articles, features and columns tries to pin down the still-to-unfold new year of 2007. Together, these small excerpts, though not covering all aspects, still give the direction in which the past trends are detrimentally going. So, here it is: what 2007 means…
- For the world economy -
According to 2007: Country By Country, just published by the Economist Intelligence Unit, an upbeat picture for the global economy overall rests largely on exceptionally strong growth in some of the world’s more exotic markets. Booming demand in China and India will also play a key role in offsetting a less exciting performance in developed economies such as the US, Japan and Germany. There are, nevertheless, number of threats that could drag down global economic performance, some stemming from the risk of a sharp correction in the US, others from an uncertain political outlook in many countries.
* The US housing market has already softened, but a sharper than expected fall in property prices during 2007 would threaten to push the economy into recession.
* There are still risks associated with the Chinese government’s attempts to slow the economy and deal with an investment bubble, especially in the run-up to the 17th Party Congress in October 2007.
* Geopolitical risk looms large, with worries about Iran’s nuclear ambitions helping drive up oil prices, tensions rising over North Korea’s nuclear brinkmanship and the ongoing terrorist threat.
* Nuclear programmes in North Korea and Iran pose a serious threat to regional political stability and to the world economy more generally
According to the World Bank, sub-Saharan Africa will grow by 5.3 percent, Central Europe by 5.7 percent, India by 7.7 percent and China by 9.6 percent in 2007.
- For China & Asia -
Writes William Pesek in Bloomberg: “The year ahead will see China under intense pressure to let its currency rise, even though it is unlikely to do so significantly. It also will be pushed to open its financial sector and clamp down on abuses of intellectual property rights. North Korea may cause many headaches for Communist Party leaders. Finally, China needs to come to terms with how it can compete in the information age while limiting the flow of information. By censoring news offered by the likes of Google.com and Wikipedia.com, China ensures that its best and brightest only know so much about advancements and trends a world away. China must loosen up if it is to encourage innovation and create more domestic growth. There are other themes that are worth keeping an eye on in Asia next year (like) US economic slowdown. Monetary policy, as the late Milton Friedman liked to say, operates with a lag. So far in 2006, the US Federal Reserve Board has added 100 basis points to the overnight lending rate to 5.25 per cent, and those increases are still funneling through the economy. The risk is that a marked US slowdown cripples China, the current regional economic growth anchor. Asia is still too export dependent for its own good, and the year ahead might serve as a reminder.”
- For global investors -
A leading market watcher of London, Michael Hughes, is upbeat about world economy. Hughes, who has been the chief investment officer at Baring Asset Management, “which manages $39 billion in institutional and mutual funds” is however worried about easy credit bidding up asset prices around the world. His observations: “The world economy is in the midst of a boom, driven by falling prices for goods and labour, that’s capable of running 5 to 10 more years. The favourable environment has been created by the industrialization of China and India and the greater mobility of capital. Economic leadership next year will shift from the West, and particularly the US, to Asia, Eastern Europe, and parts of Latin America. China stocks will remain good bets. Japanese companies are also a good investment bet, especially in small caps, which are less exposed to the strong yen because they tend to export less. Korea, Thailand, and Vietnam will do well, too, though the best way to play those markets is through diversified equity and bond funds. Commodities continue to be a good bet given the long run of growth. It’s best to use vehicles that offer balanced exposure to oil, precious metals, and industrial metals, rather than funds focused on just oil or gold. What could go wrong is the dollar, which could take a sharp fall and trigger retaliatory action from Europe or Japan, ending the current period of economic stability. With borrowing for everything, from corporate buyouts to houses running at high levels, the risk of a credit market accident that could destabilize the global economy is high. That’s because the US is using a lot of leverage, and many asset classes around the globe are expensive. As a result, the risk of asset price deflation is high.”
- For South Korea -
Standard & Poor’s expects South Korea’s economic growth to come in at 4.5 per cent in 2007, down from the 4.9 per cent projected for 2006, because the country will face a range of external and internal negative factors, including a stronger won and high oil prices. The global credit rating agency cites sluggish domestic consumption, the inflated property market and the continued strength of the won as major uncertainties weighing on the economy. Its projection of 4.5 per cent economic growth is the same as the government forecast but higher than those of most other economic institutions. Standard & Poor observes, “The slowdown in the US economy will not have a significant impact on the country, given the world’s largest economy’s stable growth and China’s continued robust expansion. Overall, we expect 2007 to be a good year for Korea even though external factors need to be monitored closely.’’.
- For venture capitalists -
What do venture capitalists expect to be doing in 2007? Predictions call for as much investment next year as we’ve seen the past two years. According to a new survey, investment in energy-related companies is projected to increase by more than 90 per cent, while Internet and media-related investments are expected to climb about 70 per cent.
- For Open Source -
Writes Neil McAllister in Computerworld: “I couldn’t have an easier time playing fortune-teller this year. While some segments of the IT market might see the future as a wide-open plain, for the open-source community, 2007 is shaping up to be a year for settling unfinished business. If we cross our fingers, we might see the end of at least one chapter. IBM and Novell have the SCO Group on the ropes in their ongoing court case. With any luck, 2007 will finally see the majority of SCO’s arguments laid to rest, ending this frustrating episode for Linux customers and vendors. Don’t assume that means smooth sailing from here on out, though. Microsoft seems determined to renew its PR war against open source with vague patent claims, as evidenced by the recent indemnification pact it signed with Novell.
- For Hollywood -
Writes Nikki Finkie in article entitled Orgy of sequels climaxing in 2007: “If you thought 2006 was bad, just wait. In 2007, the studios will give up on birthing blockbusters and concentrate instead on cloning them to knock off lame sequel after lamer sequel after lamest sequel. Familiar titles will be followed by so many numbers that filmgoers looking for a Friday-night flick will need a calculator just to figure out which of the threequels and fourquels they want to see — if any at all...
As for next summer’s sequel orgy, both Hannibal Rising (the fourth Hannibal Lecter pic, this one a prequel) and The Hills Have Eyes II will get the foreplay started, followed by Spider-Man 3, Shrek the Third, another Pirates of the Caribbean, Hostel: Part II, Fantastic Four 2, Evan Almighty (a follow-up to Jim Carrey’s Bruce Almighty, this time starring Steve Carell), Live Free or Die Hard (Bruce Willis as John McClane for the fourth time), Transformers (a live-action sequel to the animated original), Harry Potter and the Order of the Phoenix (fifth in the series), The Bourne Ultimatum (No. 3, which is actually No. 4 if you count that cheesy Richard Chamberlain version from 1988) and Rush Hour 3. Then, the sequel frenzy climaxes at the end of the year (get that Marlboro Ultra Light ready) with Resident Evil 3, Mr Bean’s Holiday (Bean II), The Golden Age (a.k.a. Elizabeth 2), Alien vs. Predator 2, National Treasure II and Halloween 2007 (too many to count). And those are just the ones I know about.”
- For Time person of the 06 year: YOU -
Writes columnist Kevin Maney in USA Today, contesting Time ‘you’ cover story, under the headline 2006 may be the year of ’you,’ but 2007 may be the year to get over it: “The Time’s choice is getting mocked by bloggers — aka users. The magazine kind of shot itself in the foot. Managing Editor Rick Stengel wrote an explainer saying that he asked for public input about the Person of the Year. Suggestions flooded in for newsmakers such as Donald Rumsfeld, Al Gore and Sacha Baron Cohen. But apparently nobody suggested "you." S
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