Financial and Economic Crisis Human Capital Investments

Question: Discuss about the Financial and Economic Crisis for Human Capital Investments. Answer: Managing across border Portugal has been affected significantly by the recent financial and economic crisis. This is due to factors needs to be addressed in order to restore the economic status of Portugal. The deficit at the budgets is becoming larger. The lack of change in the policies has led to competitive disinflation; the country has also experienced high unemployment. The continuous decline in the economic status of EU countries has caused the political shockwave and also served as a wake-up call to the policy makers. Each country has been affected by its challenges. Portugal has put in place ambitions which are ambitious to bring back the sustainability of the public finances, also reduce the external imbalances and put back the economy back to its normal. The economic recession in Portugal is over, and the cases of unemployment are going down at a healthy pace. The external competitiveness of Portugal has been restored at a faster relative speed. New improvements are enhancing to react in a flexible manner to further crisis. The economy and the financial crisis The severe macroeconomic problems were evident regarding being vast and frequent budget deficits. In that period Portugal observed low growth rates and also small factor of productivity. The increase in demand caused by the pushed wages well above productivity led to a severe loss of competitiveness. The human capital investments were small hence, the available market for Portuguese labour was also very cheap. Portugal also had low levels of education achievements this would translate to low productivity growth. In 2010, the Portugals sovereign bond rate was cut. The economy adjustment The government has come up with two objectives in trying to respond to the financial debt crisis. And to maintain the stable nature of the Portuguese financial sector. Rebalancing the social and economic costs was tough. The magnitude of the required adjustments was acute compared to the other surrounding countries. The advice from the experts in dealing with the situation was to go with the revised nominal targets in the fiscal plan. Results of the asylum seekers immigration and terrorism The impact on the productivity and the GDP per capita indicates that immigration contributes to high GDP. This is with the recent conclusions made by the office for budget responsibility. However, no consensus has been met regarding the literature on the size of contribution to productivity and GDP per capita raised by the immigrants. The evidence shows that most of the migrants have attained the degree qualifications which is higher than the natives, and this is gradually increasing over time. The implication is that immigration has a positive impact on productivity. In the immigrants labor market will increase, and there has been a dramatic change in the workforce compared to the overall populations. The evidence of foreign workers has grown fastest in the small technical sectors and occupations. The effects on the wages and employment estimate that the payments for immigration on average are small. This tends to bring the rate of employment higher than usual, and this may pose a great danger to insecurity. It is noted that there is downward pressure on the new migrants who try to find work. The strategies required for business to recover in Portugal There is a need for broad reforms that are critical to have a successful rebalancing of the economy, to restore and sustain growth, this enhances the social cohesion in Portugal. The measure should be put in place to ensure that the labor market reforms reduces the employment protection for regular contracts. New sources of growth can be generated to invest effectively and efficiently in the infrastructure and innovation that could assist Portugal to take a good advantage in the global world. The setting of wages have been an obstacle to regaining the competitiveness and have contributed to job loss should be eliminated, and employment in all sector set to promote firm-level bargaining. The government has a significant role to play in the design, implementing and monitoring of reforms agendas all aimed to efficient and effective state. References Ackers, D. (2005) the negotiations on the asylum procedures directive, european Journal of migration and law, vol. 7, no. 1, pp.1-33. Baldaccini, A. And Guild, E. (eds) (2007) terrorism and the foreigner: a Decade of tension around the rule of law in europe (leiden: martinus nijhoff). Baumgartner, F. R. And jones, B. D. (1993) agendas and instability in American politics, 2nd edn (chicago: university of chicago press). Bigo, d. (1998) scurit et immigration: vers une gouvernementalit par Linquitude?, cultures conflits, no. 31-32, pp. 13-38. Boswell, C. And Geddes, A. (2011) migration and mobility in the european Union. (basingstoke: palgrave macmillan). Fullerton, M. (2005) inadmissible in iberia: the fate of asylum seekers in spain And portugal, international journal of refugee law, vol. 17, no. 4, pp. 659-687. Geddes, A. (2008) immigration and european integration: towards fortress Europe, 2nd edn (manchester: manchester university press).