Analysis: Why trash in space is a major problem with no clear fix
September 3, 2023--There's a lot of trash on the Moon right now - including nearly 100 bags of human waste-and with countries around the globe traveling to the Moon, there’s going to be a lot more, both on the lunar surface and in Earth's orbit.
In August 2023, Russia's Luna-25 probe crashed into the Moon's surface, while India's Chandrayann-3 mission successfully landed in the southern polar region, making India the fourth country to land on the Moon.
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Source: pbs.org
Protectionism Is Failing to Achieve Its Goals and Threatens the Future of Critical Industries
August 29, 2023--STORY HIGHLIGHTS
Growing protectionism, trade tensions, and geopolitical challenges are raising concerns about the future of globalization.
Global trade has nevertheless proven resilient in the face of multiple shocks, and many countries continue to implement liberalizing policies alongside more restrictive ones.
For many technology and innovation-intensive industries, the costs and risks of severing critical global linkages would be substantial.
Since 1990, global trade has increased incomes by 24 percent worldwide, and by 50 percent for the poorest 40 percent of the population. This growth has lifted more than 1 billion people out of poverty. Trade has also played a pivotal role in shaping the global economy and promoting positive socioeconomic outcomes.
Today, however, protectionist measures are on the rise. And trade tensions and geopolitical challenges are raising concerns about the trajectory of globalization.
As a result, deglobalization-the process of reducing global economic interdependence-has been at the forefront of current policy discussions.
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Source: worldbank.org
The High Cost of Global Economic Fragmentation
August 28, 2023--Growing trade restrictions may reverse economic integration and undermine the cooperation needed to protect against new shocks and address global challenges
In a shock-prone world, economies must be more resilient-individually and collectively.
Cooperation is critical, but greater protectionism could lead to fragmentation, and even split nations into rival blocs just as fresh shocks expose the global economy's fragility.
While estimates of the cost of fragmentation vary, greater international trade restrictions could reduce global economic output by as much as 7 percent over the long term, or about $7.4 trillion in today's dollars. That's equivalent to the combined size of the French and German economies, and three times sub-Saharan Africa's annual output.
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Source: imf.org
IMF Fintech Note-Generative Artificial Intelligence in Finance: Risk Considerations
August 22, 2023--August 22, 2023--Summary:
In recent years, technological advances and competitive pressures have fueled rapid adoption of artificial intelligence (AI) in the financial sector, and this adoption is set to accelerate with the recent emergence of generative AI (GenAI). GenAI is a significant leap forward in AI technology that enhances its utility for financial institutions that have been quick at adapting it to a broad range of applications.
However, there are risks inherent in the AI technology and its application in the financial sector, including embedded bias, privacy concerns, outcome opaqueness, performance robustness, unique cyberthreats, and the potential for creating new sources and transmission channels of systemic risks.
GenAI could aggravate some of these risks and bring about new types or risks as well, including for financial sector stability. This paper provides early insights into GenAI's inherent risks and their potential impact on the financial sector.
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Source: imf.org
Global Seaweed New and Emerging Markets Report 2023
August 16, 2023--With its ability to sink carbon, sustain marine biodiversity, employ women, and unlock value chains, seaweed farming demonstrates how development, climate, and nature work together to generate value and uplift communities. Seaweed farming can help build a world free of poverty on a livable planet and has enormous growth potential.
The Global Seaweed New and Emerging Markets Report 2023 has identified ten global seaweed markets with the potential to grow by an additional USD 11.8 billion by 2030. Yet, much of the seaweed sector's value remains untapped-it has clear growth potential beyond its current markets.
Today, most farmed seaweed is used for direct human consumption, as fresh feed in aquaculture, or as hydrocolloids. However, seaweed-farmed products may be able to displace fossil fuels in sectors such as fabrics and plastics; can provide ecosystem services, such as carbon sequestration and nitrogen cycling; and can generate socioeconomic benefits in fragile coastal communities. Further, the market is currently dominated by a handful of Asian countries, which produce 98 percent of farmed seaweed by volume globally. Opportunities for growth in new regions and applications are high.
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Source: worldbank.org
IMF Working Paper-The Crypto Cycle and US Monetary Policy
August 4, 2023--Summary:
We examine fluctuations in crypto markets and their relationships to global equity markets and US monetary policy. We identify a single price component-which we label the "crypto factor"-that explains 80% of variation in crypto prices, and show that its increasing correlation with equity markets coincided with the entry of institutional investors into crypto markets.
We also document that, as for equities, US Fed tightening reduces the crypto factor through the risk-taking channel-in contrast to claims that crypto assets provide a hedge against market risk. Finally, we show that a stylized heterogeneous-agent model with time-varying aggregate risk aversion can explain our empirical findings, and highlights possible spillovers from crypto to equity markets if the participation of institutional investors ever became large.
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Source: imf.org
IMF Working Paper-Constructing a Positive Shock: Growth Through the Lens of Option Pricing
July 28, 2023--Summary:
Low-income economies face negative shocks whose frequency and disproportionate impact overcome growth trajectories, producing a negative drift. COVID-19 was the latest such episode. To escape this negative drift, and build a durable recovery, there is a need for a counter-balancing force: to construct a positive shock. Growth is realized through decisions that fall under two categories, routine and non-linear.
While routine decisions modify existing economic behavior along the same path, non-inear decisions describe riskier options that involve transformation. Option pricing theory can be useful to describe the latter, and construct the positive shock required to escape the negative drift.
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Source: imf.org
IMF Working Paper-Digital Tokens: A Legal Perspective
July 28, 2023--Summary:
Tokens are units digitally represented in a distributed ledger or blockchain. The various uses of this technology have the potential to transform a wide array of economic activities, from traditional commercial transactions to sophisticated financial undertakings.
This paper explores the similarities and differences of tokens with traditional legal instruments in commercial law and how tokens could offer superior solutions, provided that proper legal foundations are established for their operation, including aspects of the law of securities and consumer protection law.
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Source: imf.org
The Political Economy of GovTech
July 21, 2023--Summary:
The digitalization of public services, known as GovTech, can disrupt traditional mechanisms to promote economic development (for example, financial inclusion, education, and health care), improve the delivery of public services, and expedite development objectives.
For GovTech to be successful in enhancing the public sector's efficiency, transparency, and inclusiveness, its design and implementation require that private interests be aligned with the overarching goal of a "citizen-oriented" digitalization.
Because the interests of the state and private providers are often antagonistic, the social dividends from GovTech remain contingent on implementing the appropriate market structure through adequate property rights and regulatory oversight.
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Source: imf.org
Livable Planet Possible with More Efficient Use of Natural Resources, Report Says
June 27, 2023--More efficiency could help tackle climate change, economic productivity, food security, health
Global challenges such as climate change, economic productivity, food and water security, and health could be overcome if countries use their natural resources more efficiently, and this is possible without sacrificing the environment or human prosperity, a new report says.
Combining innovative science, data sources, and biophysical and economic models, the Nature's Frontiers: Achieving Sustainability, Efficiency, and Prosperity with Natural Capital report offers a novel way to address the fundamental challenge of sustainability. It identifies how and where countries can use natural resources more efficiently so they can prosper without damaging the planet-or going beyond their natural efficiency frontiers.
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Source: worldbank.org