11/13/2015
Global Growth Rates
The Organization for Economic Cooperation and Development (OECD) reduced its forecast for global growth this year once again, this time to 2.9 percent, amid a “further sharp slowdown” in emerging market economies and a deterioration in global trade.
The OECD, a respected Paris-based think tank, highlights a “deeply concerning” slowdown in global trade, citing China’s shift from investing in infrastructure to stimulate growth, to focus increasingly on domestic consumption and services.
A year ago the OECD had forecast global growth of 3.7 percent in 2015.
The OECD’s chief economist, Catherine Mann, says:
“Global trade, which was already growing relatively slowly over the past few years, appears to have stagnated and even declined since late 2014. This is deeply concerning. Robust trade and global growth go hand in hand.
“Trade strengthens competition, keeping domestic firms fit and prices low, and expands variety for consumers and businesses. Technology transfer through trade contributes to the diffusion of new technologies and productivity growth. World trade has been a bellwether for global output. The growth rates of global trade observed so far in 2015 have, in the past, been associated with global recession.”
Summary of OECD projections for selected G20 countries.
Real GDP growth (%)
World 3.3 (2014)...2.9 (2015)...3.3 (2016)
United States 2.4 (2014)...2.4 (2015)...2.5 (2016)
Euro area 0.9 (2014)...1.5 (2015)...1.8 (2016)
--Germany 1.6 (2014)...1.5 (2015)...1.8 (2016)
--France 0.2 (2014)...1.1 (2015)...1.3 (2016)
--Italy -0.4 (2014)...0.8(2015)...1.4 (2016)
--Spain 1.4 (2014)...3.2 (2015)...2.7 (2016)
United Kingdom 2.9 (2014)...2.4 (2015)...2.4 (2016)
Canada 2.4 (2014)...1.2 (2015)...2.0 (2016)
Japan -0.1 (2014)...0.6 (2015)...1.0 (2016)
China 7.3 (2014)...6.8 (2015)...6.5 (2016)
Brazil 0.2 (2014)...-3.1 (2015)...-1.2 (2016)
Sources: Financial Times; OECD
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Brian Trumbore
