Asia > Southern Asia > Afghanistan > Global growth will be disappointing in 2016: IMF's Lagarde

Afghanistan: Global growth will be disappointing in 2016: IMF's Lagarde

2016/01/02

World economic increase will be disappointing next year and the outlook for the medium-term has as well deteriorated, the chief of the International Monetary Fund said in a guest article for German newspaper Handelsblatt published on Wednesday.

IMF Managing Director Christine Lagarde said the prospect of rising interest rates in the United States and an economic slowdown in China were contributing to uncertainty and a higher risk of economic vulnerability worldwide.

Added to that, increase in world trade has slowed considerably and a decline in raw material prices is posing problems for economies based on these, while the financial sector in a lot of nations still has weaknesses and financial risks are rising in emerging markets, she said.

"All of that means world increase will be disappointing and uneven in 2016," Lagarde said, noting that mid-term prospects had as well weakened as low productivity, ageing populations and the effects of the world financial crisis dampened increase In October the IMF estimate that the world economy would grow by 3.6 % in 2016.

Lagarde said the start of a normalization of US monetary policy and China's shift toward consumption-led increase were "necessary and healthy" changes but needed to be carried out as efficiently and smoothly as possible.

The US Federal Reserve hiked interest rates for the initial time in nearly a decade this month and made clear that was a tentative beginning to a "gradual" tightening cycle.

There are "potential spillover effects", with the prospect of increasing interest rates there by presently having contributed to higher financing costs for some borrowers, inclunding in emerging and developing markets, Lagarde said. While nations other than highly developed economies were generally better prepared for higher interest rates than before, she was concerned about their ability to absorb shocks, she said.

Emerging market companies with deficit in dollars and revenue in sinking local currencies could struggle as the Fed begins what is expected to be a series of interest rate increases.

Lagarde warned that rising US interest rates and a stronger dollar could lead to companies defaulting on their payments and that this could "infect" banks and states. But she said the risks associated with these changes could be overcome by supporting request, maintaining financial stability and reforming structures.

"Most highly developed economies except the USA and possibly Britain will continue to need loose monetary policy but all nations in this category should comprehensively factor spillover effects into their decision-making," Lagarde said. She said emerging markets needed to improve monitoring of the foreign exchange risks their large companies face.

Lagarde as well said nations which export raw materials and had scope for fiscal policy measures should use that so they can adjust additional smoothly to lower prices. Others should focus on restructuring their budgets in a increase-friendly way such as through tax and energy price reforms and changing their spending priorities, she said.

相关文章

Eurasian Economic Union And Pakistan-Belarus Free Trade Engagements
2015/12/03 The newly created Eurasian Economic Union (EEU) has in a little while got the momentum as an economic hub for the nations of the region. The EEU includes Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia as its members, whereas; the Organization is a continuation of contemplation for establishing the integration projects by the Belarus, Kazakhstan, and Russia since 2007. The Organization fundamentally promotes the ideas of streamlining the flow and transportation of services and goods between the member states, therefore, it greatly attracts the interests of a lot of stakeholders and according to the Russian Ministry of Economic Development, a lot of international organizations and the economic giants like China has shown great interest in the creation of free trade zones through the EEU. The present political and economic importance of the South and Central Asian region along with free trade and economic potential across the Eurasian region greatly appeals almost each regional and international country, whether may they be developed or developing country seems eager approaching in bilateral and multilateral engagements with these organizations and the states in the region. The cooperation that is vital to the a lot of states’ national interests consists of the fields of security, economic, energy, bilateral, free trade, scientific education and cultural interactions. Most particularly, the Russian Federation and China have leading ambitious roles in region’s economic and infrastructural developments. In addition, the growing significance of the Shanghai Cooperation Organization (SCO) in the present scenario has further enabled China and Russia to become a dominant player on the world economic and political arena. This in turn has as well provided small or developing nations to benefit from the mutual benefit efforts of the SCO, EEU and other forums for their industrialization and national economic development goals.
When Will the Middle East Settle Down?
2015/06/08 Sigmund Freud suggested that psychoanalysis could convert one’s neurotic misery to everyday unhappiness. Leaping to geopolitics from psychoanalysis leads to the question of at the same time as the Middle East will be converted from massive chaos to everyday turmoil. Thinking about that reminds me of one of my favorite New Yorker cartoons. An significant executive is sitting at his mammoth desk and barking into the phone, “How about at no time? Is at no time any minute at this time enough?” Is “at no time” at the same time as the Middle East settles down? In the case of the Middle East, at no time is probably too long a time. But don’t expect any return to conventional states and normal inter-national relations for the next two decades at the earliest. Additional likely, it will be closer to fifty years.
Revised IMF forecasts signal gloom on global economic outlook
2015/01/20 Low oil prices will not provide a sufficient updraught to dispel the clouds hanging over the world economy, the International Monetary Fund said on Tuesday. In a sign of its increasing gloom about the medium term economic outlook, the IMF cut its world economic increase forecasts by 0.3 % points for both 2015 and 2016, despite believing cheaper oil represents a “shot in the arm”.
Oxfam Study Finds Richest 1% Is Likely to Control Half of Global Wealth by 2016
2015/01/20 The richest 1 % are likely to control additional than half of the globe’s total wealth by next year, the charity Oxfam reported in a study released on Monday. The warning about deepening world inequality comes just as the world’s business elite prepare to meet this week at the annual World Economic Forum in Davos, Switzerland. The 80 wealthiest people in the world all own $1.9 trillion, the statement found, nearly the same all shared by the 3.5 billion people who occupy the bottom half of the world’s gain scale. (Last year, it took 85 billionaires to equal that figure.) And the richest 1 % of the people, who number in the millions, control nearly half of the world’s total wealth, a share that is as well increasing.
TAPI member countries' state gas companies establish joint company
2014/11/14 The national gas companies of Turkmenistan, Afghanistan, Pakistan, and India have established a company that will be engaged in construction, owning and operation of the planned 1,800-kilometer Turkmenistan-Afghanistan-Pakistan-India gas pipeline, ADB said on November 13. “Establishment of the TAPI pipeline company is a key milestone in the development of the pipeline. It is a tangible sign of transformational cooperation part the parties that presages the enhanced energy security, business prospects, and in general peace and stability in the region promised by the pipeline,” Klaus Gerhaeusser, Director General of ADB’s Central and West Asia Department said. Turkmenistan’s Turkmengas National Concern, Afghan Gas Enterprise, Inter National Gas Systems (Private) Limited, and GAIL (India) Limited own equal shares of the company.