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The International Monetary Fund (IMF) maintains growth forecasts for the remainder of 2018 and 2019, but points out that the risk of economic slowdown has increased. This is reflected in the update of the report on the World Economic Outlook, released Monday.
– We maintain the global growth forecast of 3.9% for this year and next year, but believes that the risk of Short-term, says Maurice Obstfeld, chief economist of the IMF
The forecasts for Europe and Japan are revised downward by 2018, while for the United States, growth remains unchanged from the April main report.
"The downside risk has become more important, and in particular the risk of growing and prolonged trade disputes," says the IMF
the International Monetary Fund indicates that under the presidency of Donald Trump, the United States has increased tariffs. on imports from a number of the country's trading partners. This has prompted responses from, among others, China, the EU and Canada.
In addition, it appears that there is a negotiation of a new free trade agreement between Canada, Mexico and the United States. Trump has threatened to scuttle the entire NAFTA agreement, which regulates trade between these three countries.
"Growing trade conflict can undermine confidence in the commercial and financial markets, which can weaken investment and trade," warns Obstfeld and his colleagues. They believe that in the long run this could go beyond global value chains, reduce investment, prevent the diffusion of new technologies and thus contribute to lower productivity.
IMF estimates escalation risk
– Our forecasts indicate that if current threats to trade threats materialize and business confidence declines, world output will end 0.5% below current forecasts by 2020, says Obstfeld.
Friday On July 6, US President Donald Trump introduced a penalty for Chinese goods worth $ 34 billion, or NOK 274 billion. The Chinese authorities quickly recovered customs and the trade war was under way.
The Chinese counterpart did not fall in a good position with the Americans, who responded that they would impose fines of $ 200 billion. China has quickly paralyzed countermeasures
Rising oil prices
In the recent report, the IMF writes that oil prices have risen 16% since the previous report. to raise oil prices, in favor of oil exporters such as suppliers from Russia and the Middle East, but at the disadvantage for oil importers like India, Obstfeld said.
Earlier this year, Trump announced that he will impose sanctions on Iran from November and ordered other countries to do the same.
When the sanctions against Iran come into effect, the 2.7 million barrels of Iranian oil daily must be taken elsewhere. This could push up oil prices to over $ 120.
When the OPEC countries met at the end of June, they agreed to increase oil production by one million barrels
The IMF thinks that the 39; Opec could be unable to reach the production target
A decline in the ability of Venezuelan and US sanctions against Iran may make it difficult for the group to constantly increase production, says the report.
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Mixed in "Brexit"
The increased political uncertainty in Europe is also one of the new risks, according to the report. The UK chaotic announcement of the EU is mentioned in particular.
– The terms "brexit" are still uncertain, despite months of negotiations, says the report.
The US president did not help the negotiations. After an eventful week in which several government members resigned in protest, Trump fired on British Prime Minister Theresa May. He meant that the trade agreement that May wanted with the United States after the announcement probably did not matter and that she had not followed her advice. Later, it became known that the council had to pursue the EU.
At a press conference with May the same day, Trump called the interview "false news" because it did not contain his praise to the British prime minister. The conferences on international relations, Matthew Mokhefi-Ashton, told DN Friday that Trump's statements have placed May in a worse bargaining position with her own party and with the rest of Europe
is essential for growth. aim to maintain business, increase growth in the medium term and increase inclusion, the report says. In addition, many countries need to prepare for the next downturn and "strengthen the economic resilience of potentially greater market volatility".
– Avoid protectionism and cooperate to find solutions that promote the growth of goods and services global expansion, writes the International Monetary Fund. (Terms)
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