It is reported by Gulf News that "the Central Banks of the United Arab Emirates, Saudi Arabia and Bahrain will cut their interest rates by 25% basis points after the US Federal Reserve lowered its rates for the first time since the financial crisis."
This is good news to borrowers as it means an interest reduction down to 2 - 2.25% rates for loans, credit cards, and mortgages. It will help boost spending of consumers and businesses that will ultimately have a positive effect on the economy.
The world looks at the giant countries and their economic updates on the macro level, with careful linking to each country's own economic situation, because most are interrelated and connected. The cut in interest rate is a great saving that can be used to spend on necessities, investments, and money-generating packages.
Every country can help insulate its economy against the risks of economic crunch if the small and medium businesses will be given financial assistance with fewer requirements and an easier way of doing business because they comprise the majority of business owners.
Recently, the UAE government reduced related fees to set up and renew the trade licenses so this helps as well. I hope they come up with very good restorative programs for businesses that struggled and stopped for some time, and the trade licenses need to be renewed.
It helps if the enterprising employees will be allowed to do side business with a separate affordable micro-business trade license so they can earn more money to spend here, and in the future, they can make them grow.
Incentivizing businessmen/entrepreneurs, say, some privilege discount cards/coupons that will save them a big deal and more, will attract many investors.
It is a good idea also to consider an addition to the visa system. In Australia, they have a so-called working holiday visa. The same newspaper said that about 150,000 people were there on working holiday visa in March, so how much money they brought there and earned, they could spend there, too.
Another thing that can be considered especially in these days in the Year of Tolerance, is to extend consideration to the debt-strapped people so they can go back to the normal stream of life, be productive, earn money to spend which helps the family and economy, and pay debts. How many depressed debtors have taken their lives because of unbearable pressures from the collectors? At tough times a compromise will do a miracle.
It will be a life-changing move if the troubled debtors -- whoever, whatever and wherever they are -- will be reached out and will be offered online or face-to-face counseling. There are many financial literacy campaigns. It is a good idea to have restorative financial hubs where the troubled ones can comfortably discuss their problems without fear. Over time, banks/lenders can recover their receivables and absorb losses at a reduced level. Even the least recoverable amounts from bad debts of many borrowers in default can help the banks to increase the capital they must hold, and that would give a big relief to both parties. This will help surmount obstacles faced by the financial institutions and will finish the ordeal of the borrowers.
Constant aggressive campaigns for all to create and discover opportunities, not just to spend and consume products, will help in sustainability to protect us from tough times' punches.
Joblessness is one of the universal major challenges that need to be addressed. If there are many creators and discoverers of opportunities, there will be many entrepreneurs who help create jobs, and there will be unprecedented economic growth.
Health and life insurance coverage is a must, and one can only get covered if he or anyone in the family has a job with disposable income, and/or subsidized partly by the government.
Let us pray that all local, regional and international tensions will be handled wisely and well by our leaders. May we all passionately maintain a calm mind and make a situational analysis for our next moves in life. It is the best time to have a plan to protect ourselves from any crisis with our own customized 'shield'.
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Photo credits: Pixabay
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