And then the credit crunch began. A few commentatorsswiftly denounced as almost laughably alarmistvoiced their fears that the subprime fiasco might be the beginning of a meltdown of the global financial system. So far, they have still been proved wrong, but the upheaval in the financial markets and in the worlds banking system over the past year has been far more severe and far-reaching than most expected it would be.
The credit crunch also marked the beginning of a succession of seemingly unconnected events that threaten to throw off the delicate balance of the globalized economy. Rapidly rising energy prices, while causing only mild discomfort to the wealthier nations, are having a devastating effect on the worlds poorest. In tandem with the sharp rise in the cost of energy has been a painfully rapid increase in the cost of basic foodsagain hitting the poorest the hardest. And with the financial shockwaves of the credit crunch spreading ever further, Europe has finally been shocked out of its complacency and admitted that its economy may indeed be contracting.
At the same time, Russia has been throwing its weight around in a way that has caused extremeand justifiedalarm among Western European nations and beyond. China, despite being in the glare of global media attention, shrugged off worldwide opprobrium as it mercilessly crushed a powerful protest movement in Tibet. And in Zimbabwe, incumbent president Robert Mugabe brazenly attacked his political opponents and their supporters in an attempt to snuff out their chances of unseating him in the presidential election.
The dramatic return of financial insecurity, the new wave of despotism, a possible resumption of the Cold War: The events of the past year have been disturbing enough to unsettle even the most doughty optimist. But there are still signs of hopeamong the most promising, as we see in this months cover stories, being the huge surge in the effort to solve the energy crisis. But technology alone will not reverse the tide. It will take unwavering determination on the part of those committed to building a global economy based on fairness and openness that respects the cultures, humanity and environment of all the peoples on this planet. Corporations have a pivotal role to play in thatand its when times are bleak that their efforts will have the most effect.
Until next month,