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World economic growth to revive this year: G-20
19 Apr '19
2 min read
The G-20 recently said world economic growth sputtered late last year and early this year due to trade tensions, turbulent markets and rising interest rates, and is likely to recover later this year with help from the world’s central banks and from US and Chinese trade negotiators. Still, the US-China trade standoff threatens to dim the economic outlook.
“We must be mindful of an escalation of trade tensions,” Japanese finance minister Taro Aso said in Washington, where finance ministers and central bank governors from the G-20 nations ended two days of talks on April 12, according to global news wires.
The meeting was the first ministerial level talks before the G-20 summit in Osaka in June. Japan holds the G-20 chairmanship.
The International Monetary Fund (IMF) cut its forecast for global growth from 3.6 per cent last year to 3.3 per cent in 2019, the slowest since the recession year 2009, but it predicts growth will return to 3.6 per cent in 2020.
Bank of Japan head Haruhiko Kuroda told reporters the G-20 officials saw the IMF’s revised forecast as ‘highly likely’, but said all the countries would need to do their part to boost growth.
Forecasters are also worried about the US-China trade conflict. Financial markets have rallied this year on hopes that the two countries will reach a settlement.
Changyong Rhee, director of the IMF’s Asia and Pacific department, said markets could falter if negotiators cannot reach a deal after all. Even a US-China trade deal could create new problems, he said.
If China agrees to take in more imports from the United States, as is widely expected, those purchases could come at the expense of other countries that have been conducting business with China.
Rhee was concerned that China would give US companies ‘preferential access’, undercutting other countries and leading to ‘broader worries’ about the future of free trade. (DS)
“We must be mindful of an escalation of trade tensions,” Japanese finance minister Taro Aso said in Washington, where finance ministers and central bank governors from the G-20 nations ended two days of talks on April 12, according to global news wires.
The meeting was the first ministerial level talks before the G-20 summit in Osaka in June. Japan holds the G-20 chairmanship.
The International Monetary Fund (IMF) cut its forecast for global growth from 3.6 per cent last year to 3.3 per cent in 2019, the slowest since the recession year 2009, but it predicts growth will return to 3.6 per cent in 2020.
Bank of Japan head Haruhiko Kuroda told reporters the G-20 officials saw the IMF’s revised forecast as ‘highly likely’, but said all the countries would need to do their part to boost growth.
Forecasters are also worried about the US-China trade conflict. Financial markets have rallied this year on hopes that the two countries will reach a settlement.
Changyong Rhee, director of the IMF’s Asia and Pacific department, said markets could falter if negotiators cannot reach a deal after all. Even a US-China trade deal could create new problems, he said.
If China agrees to take in more imports from the United States, as is widely expected, those purchases could come at the expense of other countries that have been conducting business with China.
Rhee was concerned that China would give US companies ‘preferential access’, undercutting other countries and leading to ‘broader worries’ about the future of free trade. (DS)
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