IMF warns of growing economic disparities

Last updated 14/04/2016 - 15:49 Views 8

BAGHDAD / Economy News ...

International Monetary Fund warned last week of the political risks of isolationism, especially the prospect of Britain out of the European Union, as well as growing economic disparities, while reducing its forecast for global growth for the fourth time in a year.
The Fund, which is preparing for the spring meetings in Washington this week and said that chronic weakness revealed the global economy to the risk of shocks, such as sharp cuts to the values ​​of currencies and the worsening geopolitical conflicts.
Fund predicted in its latest world economic growth of 3.2 percent this year, compared to the predicted rate was downwardly of 3.4 percent in January with. And already cut growth estimates in July, October of last year
The IMF said that the global economy will grow 3.5 percent in 2017, down 0.1 percentage points from the January estimate.
He noted the latest report of the Fund to the aggravation of the repercussions of China's economic slowdown and the impact of low oil prices in emerging economies such as Brazil. It also highlighted the continued economic weakness in Japan, Europe and the United States.
And pave the gloomy picture for the launch of an invitation from the IMF and World Bank this week for more concerted global action to support growth.
Morris said Oobstfeld chief economist of the International Monetary Fund told a news conference «In short, lower growth means less margin for error» adding that «scars» years of slow growth may weaken in turn, demand and shrinking labor force and reduce the potential economic output even further.
Fund warned in his report of the rise of nationalist parties in Europe and the planned referendum on Britain's withdrawal from the European Union in the next 23 June and statements opposing free trade during the American presidential race and said that all that is threatening the global economic outlook.
He said that Britain out of the European Union might suffer «regionally and globally serious harm through destabilization of the existing trade relations.»
Fund urged policymakers to boost growth through measures such as the liberalization of certain industries and increase the participation of the workers. States in a position financially and recommended to increase investment in infrastructure and reduced employment taxes and encourage central banks to continue easing
The Fund has reduced expectation for the growth of Japan's economy in 2016 by half to 0.5 percent. Fund officials have since said that Brazil's economy could shrink 3.8 percent this year, while the previous forecast for a contraction of 3.5 percent as the largest Latin American economies facing economic recession is the most violent to him in decades.
In the meantime, the United States experienced one of the controversial points in the global economy is expected to reduce the Fund's economic growth in 2016 to 2.4 percent from 2.6 percent. The fund US exports adversely affected by the strong dollar sign and the continuing weakness of investment in energy due to low oil prices.
It is noteworthy that the fund has raised expectation for the growth of the Chinese economy slightly to 6.5 percent this year and 6.2 percent in 2017 partly due to stimulus measures announced in advance. But he added that it would cut its growth forecast for China's economy in the long term and said that his conversion «important» for investment-led growth still occurs jolt trade
The Fund is also expected in this regard, the growth of the economy of the euro zone, consisting of 19 countries of 1.5 percent this year and 1.6 percent in 2017, compared with 1.7 percent the past two years, as well as the prediction for the month of January last.

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