{"id":50545,"date":"2018-04-17T10:58:11","date_gmt":"2018-04-17T14:58:11","guid":{"rendered":"https:\/\/www.un.org\/sustainabledevelopment\/?p=50545"},"modified":"2018-08-16T13:09:59","modified_gmt":"2018-08-16T17:09:59","slug":"upswing-in-global-growth-wont-last-forever-imf-says-world-must-prepare-now-for-leaner-times-ahead","status":"publish","type":"post","link":"https:\/\/www.un.org\/sustainabledevelopment\/blog\/2018\/04\/upswing-in-global-growth-wont-last-forever-imf-says-world-must-prepare-now-for-leaner-times-ahead\/","title":{"rendered":"Upswing in global growth won\u2019t last forever; IMF says world must prepare now for leaner times ahead"},"content":{"rendered":"

While the world economy continues to show broad-based<\/a> momentum, a new report released Tuesday by the International Monetary Fund (IMF) is warning that there may be choppy seas ahead, caused by increasing protectionism or tit-for-tat trade wars.<\/strong><\/p>\n

\u201cGlobal growth is projected to soften beyond the next couple of years,\u201d said the report, explaining that: \u201cOnce their output gaps close, most advanced economies are poised to return to potential growth rates well below pre-crisis averages \u2013 held back by aging populations and lackluster productivity.\u201d<\/p>\n

Looking at the largest economies, the World Economic <\/a>Outlook , the Fund\u2019s semiannual report on the health of the international economy, shows growth projections at 2.4 per cent for the euro area, 1.2 per cent for Japan, 6.6 per cent for China and 2.9 per cent for the United States.<\/p>\n

\u201cDespite the good near-term news, longer-term prospects are more sobering<\/a>,\u201d said Maurice Obstfeld, Economic Counsellor and Director of Research at the IMF, the specialized United Nations agency working to ensure stability in the global financial system.<\/p>\n

\u201cAdvanced economies \u2013 facing aging populations, falling rates of labor force participation, and low productivity growth \u2013 will likely not regain the per capita growth rates they enjoyed before the global financial crisis,\u201d he continued.<\/p>\n

Mr. Obstfeld painted a diverse picture for emerging and developing economies, saying that among non-commodity exporters, some countries can expect longer-term, pre-crisis type growth rates.<\/p>\n

However, despite some improvement in the outlook for commodity prices, he pointed out that some exporters will need to diversify their economies to boost future growth and resilience.<\/p>\n

The IMF, which is holding its annual Spring Meetings in Washington, D.C., with the World Bank, continued to echo its advice that the current cyclical upswing offers policymakers a good opportunity to make longer-term growth more resilient and inclusive.<\/p>\n

\u201cSound policies can extend the upswing while reducing the risks of a disruptive unwinding,\u201d Mr. Obstfeld stated. \u201cCountries need to rebuild fiscal buffers, enact structural reforms and steer monetary policy cautiously in an environment that is already complex and challenging.\u201d<\/p>\n<\/div>