China Trade War to Hurt Global Economic Growth

China Trade War to Hurt Global Economic Growth

China Trade War to Hurt Global Economic Growth

Over 15,000 delegates from 189 countries are now gathered at Bali, Indonesia for IMF/WB Group Annual meetings from October 10 to October 14, 2018.

China's growth is still expected to be more than 6% next year, but the IMF's chief economist Maurice Obstfeld warned Beijing to concentrate on quality and sustainability of growth, not quantity of growth.

"In Angola, the region's second largest oil exporter, real GDP is expected to shrink by 0.1 per cent in 2018, following a 2.5 per cent contraction in 2017, but is projected to increase by 3.1 per cent in 2019".

"New vulnerabilities have emerged, and the resilience of the global financial system has yet to be tested", the International Monetary Fund said.

In the fund's latest Global Economic Outlook, it estimated that the South African economy would grow by 0.8% this year, down from its initial projection of 1.5% in April.

The International Monetary Fund has revised its outlook for the global economy, citing rising interest rates and growing tensions over trade.

Last year, China shipped goods worth $375 billion more to the US than it took in from the United States, a figure Trump has often said he wants to curb sharply in an effort to promote American businesses. But it predicts that USA growth will slow to 2.5 percent next year as the effect of recent tax cuts wears off and as President Donald Trump's trade war with China takes a toll.

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The exercise assumes that US President Donald Trump imposes tariffs on the remaining $267 billion worth of Chinese goods imports not already under punitive tariffs and China retaliates in kind. The Asian Development Bank has forecast 4.8 percent and the State Bank of Pakistan expects 5 percent GDP growth.

The fund upgraded its forecast for Japan slightly to 1.1 per cent growth this year, up 0.1 point from July.

The IMF, in its twice annual assessment of global financial stability, said conditions remain broadly conducive to economic growth, but are at risk of worsening should emerging markets deteriorate further or trade tensions escalate. "Risks to global growth skew to the downside in a context of elevated policy uncertainty".

The country recorded an average 4.7 percent growth between 2000 and 2009.

The IMF downgraded the economic growth forecasts for the whole region of the Middle East, North Africa, Afghanistan, and Pakistan, compared to the April edition of the World Economic Outlook, reflecting "to an important extent the worsening of growth prospects for Iran, following the reimposition of U.S. sanctions", the IMF said in the October outlook.

The IMF said the RRR cut, together with other easing and stimulus policies, "may help support economic growth in the near term in the face of rising external pressures.(but) may entail greater risks to financial stability over the medium term should they set back progress toward reducing financial vulnerabilities".

Most of the "meagre gains" from growth have gone to the well-off, fuelling support for protectionism and anti-establishment leaders, said Mr Obstfeld. "Inclusive fiscal policies, educational investments, and ensuring access to adequate health care can reduce inequality and are key priorities", he added.

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