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The International Monetary Fund (IMF) has warned that heightened trade tensions could hurt global economic growth.
In a new report on the global economic outlook, the IMF also warns of the risks badociated with a Brexit without agreement.
For the global economy, the IMF is now forecasting growth of 3.5% in 2019. In October, it forecast 3.7%.
For the United Kingdom, the report predicts a growth of about 1.5% this year and the following year, but it also indicates that there is considerable uncertainty around this figure.
The overall figure represents lower growth than last year.
Tariff increases imposed by the Trump administration in the United States and its counterpart in Beijing have already contributed to a previous deterioration.
The IMF also expects the slowdown in China to continue. The forecast for this year and the next is 6.2%.
In this new badessment, there are revisions for developed economies, particularly the euro area.
This reflects the disturbances of the German auto industry related to new fuel emission standards.
Italy is also a source of concern as financial markets have been disrupted by government plans to increase spending. The country's banking system also has persistent weaknesses.
Uncertainty about Brexit
The outlook for the UK is particularly uncertain, although the outlook for next year is slightly revised. The 2019 figure is unchanged.
The forecasts are based on the badumption that an agreement on Brexit is concluded this year and that there is a gradual transition to the new relationship with the European Union. The IMF warned before that a Brexit without agreement would imply substantial costs for the UK economy.
Various factors also weigh on the prospects of some emerging and developing economies. Iran is affected by sanctions, Saudi Arabia by weaker oil production.
The economies of Turkey and Argentina are expected to contract, as is the case of Venezuela, but the situation will probably be even worse than previously expected.
That said, the main global forecast of 3.5% nonetheless represents a respectable increase in economic activity.
But the fear that it does not happen as well is obvious.
Trade tensions appear to be the main concern and have been a recurring theme in recent IMF badessments of the economic outlook. This is reflected in the call by the IMF to the governments of member countries for action.
"The main shared political priority is for countries to cooperatively and swiftly resolve their trade disputes and resulting political uncertainty, rather than remove harmful barriers and destabilize an already slowing global economy," he said. the IMF.
The report recalls that in its October forecast, there had already been a deterioration, partly because of the impact of tariff increases imposed by the United States and China.
"Increasing risks"
The IMF also says that financial markets are risky.
IMF chief economist, Gita Gopinath, said: "While the financial markets of the advanced economies seemed to be decoupled from trade tensions for much of 2018, the two have intertwined more recently, tightening the financial conditions. and increasing the risks for global growth. "
In addition to global trade tensions, the report mentions a further slowdown in China and a lack of agreement on Brexit, which may be factors in the future deterioration of financial markets.
The overall objective of this report is that the IMF expects the recovery from the Great Recession of 2008-09 to continue. But the clouds, however, are gathering.
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