Ten pictures to understand the World Bank’s 2019 economic forecast report.
The World Bank lowered its forecast for the global economy, because the slowdown in trade and investment growth and the rise in interest rates weakened the economic growth momentum, especially in emerging markets; The threat of "disorderly" market fluctuations and the escalation of trade disputes have also aggravated the economic slowdown; The debt vulnerability of emerging markets and developing countries has increased.
The World Bank called on countries to remain "flexible and pragmatic" during economic shocks.
1 Overall forecast of world economic growth
It is predicted that the global economic growth will be 2.9% in 2019, compared with 3.0% predicted by the World Bank last year.
2 GDP growth of major global economies in 2019
Among them, 2018 is the actual data and 2019-2021 is the forecast data. The forecast of US economic growth of 2.5% in 2019 remains unchanged; The euro zone will grow by 1.6% this year, 0.1 percentage points lower than the forecast in June; China’s economic growth forecast is lowered by 0.1 percentage point to 6.2%.
3 the growth of global GDP and demand (consumption, investment and export)
Exports are still dominant, but the proportion is declining.
4 growth of emerging economies (emerging economies; Commodity exporting countries; Commodity exporters other than China)
5 Forecast of World Trade Growth
6 tariff protectionism
If all the new tariffs currently under consideration are implemented, more than 5% of global commodity trade will be affected, and the average tariff rate in the United States will rise to the highest level since the late 1960s. The restraining effect of trade tensions involving major economies may be amplified by the decline in investor confidence. The cost of protectionism can be multiplied by global value interconnection, especially in emerging market countries.
7 Low-income countries are heavily in debt.
Debt fragility of low-income countries has increased. Although borrowing helps many countries to solve their important development needs, the ratio of average debt to GDP in low-income countries is rising, and the debt structure has turned to more expensive market-oriented financing sources. These economies should focus on mobilizing domestic resources, strengthening debt and investment management methods and establishing a more resilient macro-financial framework.
Note: The figure shows the proportion of low-income countries eligible for preferential IMF loans. These countries either face high-risk debt difficulties; Or in debt trouble.
If a country encounters difficulties in repaying its debts, such as default, ongoing or imminent debt restructuring, or there are signs that debt difficulties may occur in the future, it is considered that the country is in debt trouble. The sample includes 30 low-income countries, excluding Eritrea, Somalia and Syria due to data constraints.
8 Informal industries with low productivity dominate emerging markets.
The informal sector accounts for about 70% of employment and 30% of GDP in emerging markets and developing economies. Because it is related to lower productivity and tax revenue, and higher poverty and inequality, it represents a lost opportunity. Reducing the burden of taxation and supervision, improving financing channels, providing better education and public services, and strengthening the public revenue framework will help create a level playing field between formal and informal industries.
Maintaining a low and stable inflation rate has become a challenge, especially in emerging economies.
In emerging markets and developing economies, there is no guarantee to maintain the low and stable inflation rate in the past. The cyclical pressure to curb inflation in the past 10 years is gradually dissipating. The long-term factors that have helped reduce inflation in the past 50 years-global trade and financial integration and the widespread implementation of a prudent monetary policy framework-may lose momentum or reverse. Maintaining low global inflation may be as challenging as achieving it.
10 Global real GDP forecast in January GDP2019
The World Bank calls on countries to be "flexible and pragmatic"
Kristalina Georgieva, CEO of the World Bank, told reporters in a conference call on Tuesday: "We are facing a more difficult period in the global economy, and the recent turmoil in financial markets has undoubtedly sent us this signal.
Ayhan Kose, director of the development prospects group of the World Bank, told reporters that central banks need to remain flexible and "pragmatic" during the financial turmoil. He said that although the recent weak data is disturbing, it remains to be seen whether this is a sign of further economic slowdown. Financial markets tell us that this is a big problem. (End)
This article first appeared on WeChat WeChat official account: RMB Trading and Research. The content of the article belongs to the author’s personal opinion and does not represent Hexun.com’s position. Investors should operate accordingly, at their own risk.