5 Ways Politics Affects the Global Economy and Your Finances

By   /   January 16, 2019  /   Comments Off on 5 Ways Politics Affects the Global Economy and Your Finances

Universally, economic development dominates political discussion.

 

The United Nations knows the important role governments play in promoting any countries economy.  All members hope for stable governments securing and maintaining economic well being for it’s nation.

 

The United Nation Development Programme (UNDP) was created to provide “expert advice, training and grants support to developing countries, with increasing emphasis on assistance to the least developed countries”.

 

Here are three important roles governments play in promoting healthy economies.

  1. Ease Financial Burdens

 

 

The government through its legislators and the executive arm can come up with subsidies that are meant to ease the financial burden on both its citizens and some key industry players.

 

For instance, the Childcare subsidy in New Zealand was introduced to support families financially. This subsidy is a payment that helps families with the cost of pre-school childcare. Childcare not only gives parents time-out from parenting but it is designed to give parents with the opportunity to work and earn money to support their family.

 

As a result the social welfare system feels less strain.

 

  1. Policy Making

 

The government is responsible for coming up with policies that ensure the country improves its infrastructure and protects its citizens. Economic growth is dependent upon society providing development of transportation and roads to take people to work. Investing in buildings to house the office workers and families. Also the development of schools to hospitals to nurture the health of the community. All of these critical services provide much needed jobs to the community.

 

Politicians are responsible for delegating where they believe all the taxpayers funds should be distributed. How will the money be divided? This often becomes the most hotly discussed issues within politics.

 

When the politicians get it right, these much needed funds can impact the citizens in a positive way. This significantly leads to improvement in health, education and financial status of the citizens.

 

  1. Stimulate the Construction Industry

 

 

The government has the power to boost the construction industry in several ways. Commonly they will loosening lending restrictions to encourage banks to lend more money to citizens for new homes. As a result many new houses will get built, real estate prices will go up and construction companies will be hired to renovate and develop properties.

 

Another popular initiative passed by the New Zealand Government to stimulate the construction industry is the First Home grant. This grant helps eligible buyers to afford to buy selected properties Housing New Zealand is selling across the country.

 

“To help with the deposit, eligible buyers receive a grant of 10% of the purchase price of the property, capped at $20,000”.

 

Finance expert Dougal Shand from quickloans.co.nz said, “politicians involved in the formulation of policy should be selfless and focused on public service. They should come up with policies that ease borrowing of finances in banks and private institutions. This stimulates job growth and supports small business, whilst helping people afford holidays, weddings, cars, businesses and homes”.

 

  1. International Relations

 

International institutions such as the World Bank should collaborate with different countries to ensure that employment opportunities are made available.

 

This can be achieved through the provisioning of funds to manufacturing and agricultural sectors. This will enable citizens in these countries have work opportunities and abundant supply of food. This income will play a vital role in reducing the poverty levels in developing countries.

 

  1. Climate Change

 

The government should enforce international treaties that recognise climate change. It should, therefore, implement policies that ensure the reduction in global warming.

 

This may be accomplished through punishing companies that pollute the air and water.  The importance of these policies is to ensure sustainable development which will be able to benefit both the current and the future generation.

 

Climate Change will be a great financial burden on all countries across the world. As temperatures rise so does our insurance policies and wasted taxpayers money on rebuilding cities.

 

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Authorised by Martyn Bradbury, The Editor, TheDailyBlog,