Reconfiguration of the global financial system between 2006/2016 . . .

At a time of the Brexit announcement, new mutations in the financial global markets, all at the expense of the City came to light.  The  magazine  “The Banker” of June 29th, 2016 in an article titled Top 1000 World Banks 2016 has revealed in an interesting review written by Joy Macknight, the distribution of the profits of the top world 1000 banks arranged by their country of origin, in % market share, etc.

I give briefly the main outlines here :

  1. Europe held 32.2% in 2006, and only 13.2% in 2016.
  2. The USA, more resistant with 26.5% in 2006 and 21.2% in 2016.
  3. China going through a breakthrough blazing from 4.3% in 2006 to 31.6% in 2016.
  4. Japan knowing a relative recession from 8% in 2006 to 5.9% in 2016.
  5. The United Kingdom with 10.1% in 2006 after having benefitted from its integration to the 28 countries EU with the revitalization of the City reaching 21.2% in 2016.
  6. Asia excluding Japan and China accounted for 8% in 2006 and 14.9% in 2016.
  7. And finally the rest of the world knowing stabilization with 10.9% in 2006 and 10.7% in 2016.
  8. If Japan and China were integrated into one, it will bring their total to 52.4% of the planet

The lessons from this interesting survey should make the Algerian Government reflect, on the country’s finances future that is in great need of adaptation to this new world in the making.

A new world that as reviewed by ‘The Banker’ should know important geostrategic changes in all political, cultural and economic sectors that presumably would impose on Algeria, deep structural reforms and not short-term actions that would only postpone current and future problems to a later time.

Included in these reforms of the Algerian institutions, would be the educational system and the current financial system that is presently only a simple instrument of regulation of the rentier economy.

According to my information, a financial institution and an Euro-Mediterranean Stock Exchange are planned to arise between 2020 and 2025, with the strategic goal to be directed towards Africa ; the most difficult part of the world to get a foothold and acquire any market share.

It therefore announced a global reconfiguration for the benefit of horizon 2040, whereby rivalries are now between the major powers including US, China and Europe, preparing the future of their economies.

Four lessons for Algeria and others in the MENA region from this interesting survey and these are :

1 – There is urgency in the adaptation of Algeria through profound structural reforms, that should include all institutions, debureaucratisation of the Central and Local administrations by promoing all creative energies, by also reviewing the educational system, and reforming the labour and the land markets.

2 – The second important lesson is that the structures of the Ministry of Finance being as it were the lungs of the reforms,  with respect to tax, land deeds, customs, banks, stock exchange, the current financial system is in great need of an urgent transformation taking into account new technologies.

3 – The third lesson would be to prepare the country to fit within the global financial system.

4 – The fourth lesson is that Africa will be the continent of all expansions, horizon 2030 to 2040, and being currently, one of the markets upon which rivalries from Europe, the US and China are more and more coming into the open.  The importance of Algerian diplomatic and financial networking prior to any action of the  business community cannot be more emphasized.

University Professor, Expert International,  Dr. Abderrahmane Mebtoul,  ademmebtoul@gmail.com

Notes:

Updated on 30 June 2016, 12:15 GMT

Read more after subscription at  http://www.thebanker.com/Top-1000-World-Banks/Top-1000-World-Banks-2016

(1) Source :  The Banker “Top 1000 World Banks 2016 – The 2016 Top 1000 results are indicative of the challenging environment, banks found themselves operating in during 2015.  ”Even the Chinese banking industry’s meteoric growth shows signs of slowing down for the first time in a decade”.

(2) (Thanks to my friend Professor Emeritus of Universities – Zoubir Mortada – political science foresight, adviser to Government strategy – Montreal Canada for his kind counselling.

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