Due to rising trade barriers and geopolitical tensions, the International Monetary Fund (IMF) has lowered its global growth forecast for 2019 to 3 per cent.
This development was pointed out in the newly released World Economic Outlook (WEO) report.
The IMF chief economist, Guts Gopinath observed that the growth is weighed down by factors peculiar to various countries in several emerging market economies and structural forces such as low productivity growth and ageing demographics in advanced economies.
Gopinath observed that this is the slowest pace since the global financial crisis, stating further that “growth continues to be weakened by rising trade barriers and increasing geopolitical tensions.”
“Growth is also being weighed down by country-specific factors in several emerging market economies, and structural forces such as low productivity growth and ageing demographics in advanced economies,” Gopinath said.
Advanced economies continue to slow towards their long-term potential, with growth downgraded to 1.7 per cent this year, compared to 2.3 per cent in 2018, the report showed. Growth in emerging market and developing economies has also been revised down to 3.9 per cent for 2019, compared to 4.5 per cent last year.
The October WEO report also revised down global growth projection for 2020 to 3.4 per cent, down 0.1 percentage point from the estimation in July. Previously, the July WEO report already lowered growth forecasts for 2019 and 2020, each down 0.1 percentage point from the estimation in April.
