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More than those foreign aids, the foreign direct investments (FDI flows) into our country may get reduced.This will be very harmful to our economy, especially in a time when we are badly in need of those FDI flows to undertake large projects which can potentially create many jobs.I think it’s high time that the government and tourism sector start thinking about this and plan how to tackle the problems.And this again highlights the danger of not having a diversified industrial base in our economy and depending too heavily on tourism sector.
So the current financial crisis can have potential negative effects on our tourism sector.
When those borrowers defaulted on their loans, it wasn’t only the initial lenders who got in trouble.
Through securitization, the initial lenders transferred those loans to other investors in the first place.
Merely a financial crisis at the start has turned into a real economic crisis posing concerns over economic growth, employment etc.
It’s for this reason we can’t shut our eyes on the crisis saying it’s a problem to be dealt with developed countries and international community.
These individuals were only delighted to take up those offers with their unstable employment and income flows.