Two economists stressed that the global markets are facing many challenges in light of the increasing fears of economic recession as a result of fluctuations in inflation rates and banking failure, pointing to the importance of capital flows in the local markets, and the conclusion of more deals to face these economic pressures.
They were speaking at a session entitled "Thriving in Volatility" as part of Qatar Economic Forum, Powered by Bloomberg that is currently taking place in Doha.
Chief Investment Officer at Temasek Rohit Sipahimalani said that the tightening of monetary policy taking place globally is a precursor to a recession, especially as inflation remains high. He said that it is not possible to expect a default in debt repayment, as quick corrective measures can be resorted to if this occurs, expressing his concern about the structure of the global economy in light of the state of tension during the current decade, and its repercussions on projects, economies and the investment environment.
He added that overcoming the pandemic required a longer time than expected, which impacted growth levels, He also said that the rising tensions between the US and China could threaten many industries.
He stressed the need to follow economic policies outside areas of tension, by focusing on issues such as sustainability and solar cells, as well as searching for other economic opportunities in safer regions, such as the Middle East, which is a promising area for investment.
For his part, Founder and CEO of Moelis & Company Ken Moelis said that the banking crisis will have negative implications given the speed at which deposits can be withdrawn.
He said that it was difficult to avoid a recession given interest rates remain high. He noted that the slowdown seen in earning growth indicates the difficulties the global markets face.
He also highlighted the promising investment opportunities in the GCC, saying it enjoys a number of characteristics that makes it a distinguished investment destination.