OECD warns on global slowdown, while UK growth 'robust'
Global economic growth has weakened this year due to a sharp fall in emerging market economies and weak world trade, while the UK’s economy will continue to grow at a “robust pace”, according to the OECD.
Presenting its Economic Outlook, the OECD said the slowdown in global trade was “deeply concerning”, with recessions in Brazil, Russia and the slowdown in China affecting key trading partners.
Global GDP is now projected to grow by 2.9% this year, the weakest since 2009 and well below the initial growth prediction of 3.7% for 2015 forecast last November. This is expected to increase to 3.3% in 2016 and 3.6% to 2017.
Economic growth in the UK is expected to be robust for the coming two years, driven by domestic demand.
However, the OECD warned that while the UK trade deficit has remained contained, weak global trade and past currency appreciation are holding back exports.
OECD Secretary-General Angel Gurría said: “The slowdown in global trade and the continuing weakness in investment are deeply concerning. Robust trade and investment and stronger global growth should go hand in hand.”
The OECD called on countries to have “greater ambition” to boost potential growth and ensure that economic benefits are shared by all. It also said that countries need to “step up structural reform efforts” – including tax, regulation and innovation – and adjust public spending towards investment.