The formation of the world economy began at the beginning of civilization itself. As it is known historically, people used barter to affect sales transactions, because there were no monetary units yet. But with the development of modern society, we did not have enough of those opportunities for natural exchange and, therefore, we looked for a universal payment tool that could be available around the world.
Thus, the global economic and financial system was formed.
We are still looking for a universal unit for the world market that can be used freely within the economic structure.
The following are the nuts and bolts of world economy:
- market of goods and services
- capital market
- labor market
- financial market
Together these form the basis of world prices, and the world economy as a whole.
The main trends in the development of the world economy are:
- development of scientific and technological progress,
- expansion of cooperation in the field of science and information technology,
- increase in the importance of transnational corporations in the system of international production of goods and services, and
- development of international monetary centers and international economic institutions.
At the same time, stable trends of macroeconomic growth is characteristic of the most highly developed countries.
The oil industry, planting, agriculture, and financial markets are the inseparable parts of the world economy. But, all of these parts can be separated or destroyed by the wrong policies. Now, the oil industry plays one of the key roles in the world economy.
In 2017, there were 5 times more cyber-attacks on businesses than in 2012
Some countries, thanks to abundant oil resources, could build amazing cities in the middle of the desert (Dubai). Other countries are trying to raise their economies with the help of oil production. The world realizes that the more raw materials the state has, the more developed is its economy. Economic dominance is considered more important than military power.
The number of wars across the globe increases, and refugees flow from different countries looking for a peaceful life but life can not be peaceful if there is no stability in the country, in terms of economic development.
To date, science stands almost in a significant place in state development.
We are in the era of scientific technology but very soon the age of bioengineering will come. The problem is that all states do not address their policies in the same direction, and competetion is increasing daily. This will, sooner or later, destroy diversity in the world economy.
Another threat to the world economy is the loss of jobs.
At this stage, most enterprises have a mechanized structure of work instead of a manual one. Jobs are lost, the economic life of regions is becoming more severe, and people without work lose their priorities. All of this affects the lives of ordinary people, and also affects the structure of the world economy.
The world economy has finally recovered after the global crisis, and economic risks give way to environmental and technological, according to a survey of the World Economic Forum (WEF).
The most likely risks are environmental and technological.
Almost 24 million people left their homes in 2017 because of environmental disasters. In September 2017, the highest number of hurricanes was recorded. 2017 became one of the hottest years.
The risks of cyber security also increased. In 2017, there were 5 times more cyber-attacks on businesses than in 2012.
According to the World Bank's forecast, in 2019 the growth of global GDP will slow down to 3%, and in 2020 to 2.9%.
Climate change causes migration and threatens international security. Political conflicts prevent countries from cooperating; governments spend resources, that could be better spent, on combating climate change and solving migration issues. Risks of refusal from commercial projects, cancellation of manufactures and restriction of movement of capital are growing.