Director of the Peterson Institute for International Economics Fred Bergsten told Ukrainian students “How to Get the Global Economy Back on Track”

On Friday, November 18, 2011, the Victor Pinchuk Foundation hosted a Public Lecture featuring Doctor C. Fred Bergsten, director of the Peterson Institute for International Economics. The lecture given by this famous American economist was entitled How to Get the Global Economy Back on Track.

The event took place at the Diplomatic Academy of Ukraine. It was attended by 300 people, including Zavtra.UA scholarship holders, selected students of the top Ukrainian universities and Ukrainian experts.

At the beginning of the lecture Dr. Bergsten emphasized that today “we have a world of two different halves: one half is the emerging and developing countries growing at more than 6%; the half of high income industrial countries growing at less than 2%, a world average of 4%, but in two different parts. Ukraine is somewhere in between.”

Talking about Ukraine Dr. Bergsten listed key lessons in economic policies that Ukraine ought to learn to climb a ladder towards the top of emerging market: “Ukraine must globalize its economy. No country in history has achieved successful economic development without participating actively in the world economy. A number tried – Nazi Germany, Soviet Union, currently North Korea and Cuba. Everyone who has tried it has failed. Even if they had a lot of resources, lots of intelligence, lots of man power. You must globalize to be successful. One reason for that is that you must be able to attract footloose international investment to participate in your economy, brining the most modern technology, management skills marketing operations. Capital is not the most important, if you are doing reasonably well you can get capital, but you need the skills which are uniquely available to global marketing chains through internationally oriented corporations that operate on the global scale.”

Regarding Europe’s future development, Fred Bergsten conjectured that “the Euro area will overcome its problems and begin to recover and indeed strengthen its economic performance coming out of crisis over the next couple of years. And if I am right that US will continue to fail to deal with its problems, in two or three years from now we might actually face an opposite situation to now, where the Euro was all over sudden getting strong, dollar was all over sudden getting weak and there was a substantial reversal of economic fortunes which among other things might just be a source of new market pressure that would force US like the Europeans now to get serious about its underlying economic problems and do something to put this house in order.”

In addition, this famous economist predicted that emerging markets are likely to continue their growth and even possibly accelerate their leadership of world economy. “Their share of the world economy is expanding by two or three percent each point every year. It is traditionally been said about US that if US catches cold the rest of the world will get pneumonia. That is now clearly disappeared and it may be even in reverse. If China now catches cold the rest of us may get pneumonia because then the biggest driver of global growth will not be providing so much help.”

The Peterson Institute is led by Dr. Bergsten since its creation in 1981 and is the only major research institution in the United States devoted to international economic issues. It has been called "the most influential think tank on the planet".

Dr. Bergsten has been the most widely quoted think tank economist in the world over the eight-year period (1997–2005). He was ranked 37 in the top 50 "Who Really Moves the Markets?" by Fidelity Investment’s Worth and as "one of the ten people who can change your life" by USA Today, along with the inventor of the World Wide Web and the discoverer of ozone layer depletion. He has received the Meritorious Honor Award of the Department of State, the Exceptional Service Award of the Treasury Department, and the Legion d’Honneur from the Government of France. Fred Bergsten has been named an honorary fellow of the Chinese Academy of Social Sciences.

By organizing such a dialogue between world leaders, experts and Ukrainian students, the Foundation contributes to fostering a new generation of responsible leaders. For five years, the Foundation has been inviting internationally renowned economists, politicians and public figures to Ukraine to discuss today’s challenges facing the country and the world.

Following experts have previously given public lectures: Dr. Robert Engle, 2003 Nobel Prize Laureate; Dr. Francis Fukuyama, Professor of International Political Economy at the Johns Hopkins University; co-author of ‘Microeconomics’ Dr. Robert Pindyck; James Wolfensohn, the 9th president of the World Bank Group; Muhammad Yunus, 2006 Nobel Peace Prize Laureate; Colin Powell, the 65th US Secretary of State; Javier Solana, former High Representative for Common Foreign and Security Policy of the European Union (1999-2009) and Secretary General of NATO (1995-1999); former Vice Chancellor of Germany Joschka Fischer; the 42nd President of the United States Bill Clinton; President of Israel Shimon Peres; former Prime minister of Great Britain Tony Blair and others.