The Chief Executive Officer of Golden Palm Investment, Mr Sangu Delle, has predicted a global economic recession in the next 24 months following the expansion of the US economy and the ongoing trade wars among the developed economies.
He, therefore, advised individuals and businesses to manage their finances conservatively by stocking up cash, reducing debt and creating much more flexibility in their finances.
Mr Delle was speaking on the Springboard, Your Virtual University, a radio programme on Joy FM. It was the first edition of the ‘African Excellence Series’ which seek to continually have conversations on how individuals and businesses can excel on the continent.
“From some of the things happening on the global market, such as the strengthening of the US dollar and the trade wars, I continue to have deep concerns.
I am expecting that we will have a slowdown if not a global economic recession over the next 24 months.“What this means is that we have to prepare ahead.
In a world where there is a slow- down or economic recession, there is going to be a tightening of the credit market, meaning it will be harder to borrow so individuals and businesses really have to protect themselves by ensuring that they save as much cash as possible and reduce their exposures to debt,” he explained.
He said this was the time for people to be financially conservative.
“Of course, I am not saying people should have zero debt because there are some debts like mortgage that makes sense but you need to run stress scenarios for yourself. You need to stress test your personal finances,” he noted.
Touching on the associated job losses, he said the dynamics of employment would change and would be driven largely by technology which would lead to job losses.
He said as much as 40 to 50 per cent of existing jobs would be threatened by automation, artificial intelligence and machines.
In addition to that, he pointed out that globally, telecommunication companies which used to be a major employer were seeing their voice revenues come under threat, causing most of them to downsize.
“We are seeing challenges in the global telecommunication industry and with the coming on board of Basel II and III, we are seeing some consolidations in the global banking sector as well which have also led to job losses.
Clearly, we can see that some of the sectors that traditionally used to be a major source of employment are now recording negative figures,” he explained.
On the flip side, he said there were also numerous opportunities that technology would come with.
“Technology will disrupt some jobs but will also create huge opportunities in certain sectors like the software developing sector,” he stated.
Commenting on how individuals and businesses can achieve excellence, Mr Delle said having a globalised perspective gave an individual the nuance and allowed him to see the world from different perspectives that helped make him better.
“You don’t have to necessarily travel all over the world; you can globalise your perception without travelling.
You have to read widely about the global economy. You have to find out how different countries are receiving the same news and seeing things differently,” he stated.
He said there was a lot of research that indicated that diverse individuals and diverse companies outperformed non-diverse ones.
“There is power in diversity and it is important for us to ensure that. If you are hanging out with people who are the same and think the same like you, then you will have only one way of looking at the world.
But if you associate with different people, you have diverse friends and interact with people who are not like you, you get different perspectives about the world which really shape and enhance your life,” he explained.
Mr Delle also highlighted the importance of networking in one’s quest to achieve excellence.
“It is important for us to promote the idea of networking. People sometimes think about networking in a negative way but I think of it differently.
In anthropology and sociology, there are different types of capitals. There is financial capital which is money in your pocket but there are other forms of capital such as social capital which is not money but a network of people you know,” he pointed out.
Mr Delle said the social capital could create something that would have more value than the financial capital.
He also talked about cultural capital which is one’s knowledge and ability to understand things that would give him or her currency in certain situations.