Forex is one of the biggest and most important factors that move nations

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Forex is one of the biggest and most important factors that move nations

 Forex in its development and prosperity, as it is the element that brings money and wealth necessary to build civilizations and implement inventions, and it is the Forex that contributes significantly to the disposal of various industrial, agricultural and commercial resources, and therefore it has received its various concepts and types of great interest around the world.

Economy concept

  • Economics is defined as the activity of Forex based on the production, distribution and exchange of commercial goods and services between institutions, individuals or countries, describing the production process and providing appropriate analysis for it. A wide range of study topics such as: recession, finance, Forex.

Forex branches

Forex, in its general sense, is divided into two main branches:

Micro-Forex:

It is the economics that deals with the study of micro-economic phenomena; Such as studying the behavior of individual economic units, where the level of individuals is the level on which this branch is based.

Macroeconomics:

It is the economics that is concerned with the study of macroeconomic phenomena such as: national product, national income, investment, Forex, aggregate demand, and aggregate supply. This branch focuses entirely on countries and societies.

types of economy

Forex includes four main types, each of which has its own pros and cons, weaknesses and strengths, and each of them has its own unique character, and these types are:

Traditional Forex: It is the oldest type of economy that people knew and dealt with in the past, as it no longer has any presence in the countries of the greatest economic power at the present time, and it is known as a system that depends entirely on ancient customs,

  • history and beliefs, as it relies on agriculture, fishing, and hunting. , or a combination of the above, and it has been widely used in emerging Forex and developing countries such as Asia, Africa, Latin America and others, and one of its most prominent characteristics is that it is limited to a family or tribe that has acquired the same customs or perhaps a small artisanal group such as a group of fishermen, for example. .
  • Directed Forex: It is a system that is controlled by a central authority, and often the government that runs the state, and therefore it is called a planned economy,

where this authority exercises the profession of managing production in this type of economy, not the free market. The government determines the goods to be produced, and the amount It is an essential feature of any communist society, such as the societies of Cuba, North Korea and the former Soviet Union,

  • but this type suffers from some Forex such as: the inability of the body that regulates the economy to allocate goods High efficiency, or the inability to determine the amount of production, which leads to the emergence of problems of shortage or increase in goods, in addition to the problem of ineffective pricing, which depends on the basis of revenue needs.

Market economy:

It is the free Forex that is controlled by the forces of supply and demand without any government interference, and is represented by the consensus of most of the major economic decisions determined by the market and which are controlled by the laws of demand and supply. Owners are free to produce, sell and buy goods and services in a competitive market, self-interest, and determine the role of government by opening markets and doing well.

Mixed economy:

a mixture of the command and free economic systems, in which the market is free from government ownership except for a few key areas.

The fragility of economic growth under the rentier Forex

How is it possible to imagine solid economic growth in light of a rentier economy characterized by the above characteristics, a monolithic economy, a state economy, depleting, dependent, fluctuating, and unfair! Certainly unimaginable because, as we mentioned above, Forex growth is achieved through the increase in the economic sectors that make up the GDP, provided that this increase is characterized by continuity, diversification and balance, i.e. the convergence of the proportions of the contributions of the increase in output, otherwise it will become unstable growth.

The problem of the rentier economy is not only that it is unilateral and its dependence on the rentier sector, but that this unilateralism contributes significantly – due to the absence of efficient management, the weakness of serious will and the vagueness of the strategic vision – in disrupting the economic sectors, especially the productive ones, which represent the core of the strength of economic growth when they are active and effective.

  • Since the rentier Forex depends largely on the rentier sector and at the expense of other sectors, the economic growth in this economy is hostage to the rentier sector whose prices are subject to international markets and their fluctuating conditions for political, economic, climatic or other reasons, so the Forex is unstable and fluctuating according to price fluctuations The products of the rentier sector, that is, whenever the demand for the products of the rentier sector improves, their prices will rise, and then economic growth will rise and vice versa. Accordingly, economic growth will be unstable, continuous and fragile under the rule of the rentier economy.
  • In order to increase the strength of Forex growth in countries that suffer from the
    rentier economies and the fragility of their growth, the following must be done:
  • First: Develop an economic vision that aims to build a diversified production base, especially agricultural, manufacturing, and others, that is capable of meeting foreign and foreign demand and facing crises.
  • Second: Defining the role and limits of the state and the private sector in order to avoid the Forex that occurs in the absence of defining their roles.
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