The IMF have just released a report highlighting the huge risks of the debt crisis spreading beyond the Eurozone and into poorer countries across the planet. Although obviously all the big economies in the world have their own issues, it is vitally important that the impact on smaller nations is not neglected.
The report looked at over 30 different countries – from medium sized to emerging nations. They raised the important issue that not enough is being done to stop the spread of the stresses affecting the major economies. They described a worst case scenario in which the output of the Eurozone fell by 5% in reaction to any worsening of the the crisis if action was not taken.
Of course the impact on poorer countries would be even worse, the debt requirements of some of the countries would rise significantly. The assessment suggested that the extra financing needs could reach about $27 billion by the start of 2014. Combine with this the possible drop in investment from places like China and the Middle East Oil exporting countries could cause far reaching global affects.
The developing countries need capital to invest in their infrastructure. The employment and entrepreneurial opportunites offered by the internet for example can transform a country. However without the relevent infrastructure these opportunities will be limited to specific areas. As long as there is access to the internet then for many web based industried location is irrelevent. A company specializing in SEO and Social Bookmarking can operate from anywhere without any difficulties. But without foreign investment the infrastructure will not be built.