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‘RISKS REMAIN’

Headline figures mask growth that is uneven, says UN

Global economy to see 3pc growth in 2019: UN

NEW YORK, January 22, 2019

The global economy grew at a “steady” 3.1 per cent last year and similar levels of growth are expected in 2019, but these headline figures mask growth that is uneven and often failing to reach where it is most needed, the UN’s chief economist warned on Monday.

“We still have relatively strong growth, but we do see rising risks on the horizon and an increasing likelihood that some of these risks might actually materialize,” said Elliott Harris in comments coinciding with the launch of the World Economic Situation and Prospects 2019 (WESP) report.

Among these looming dangers, accelerating trade tensions are already “having an impact” on global trade and employment, Harris told UN News.

In addition, rising national debt is also crippling many countries’ ability to provide basic services, but this and other risks – such as those from climate change and waning support for international cooperation – could be avoided or minimized if countries worked together to do so, the UN’s top economist insisted.

With mounting pressures in the areas of international trade, international development finance and tackling climate change, the report underscores that strengthening global cooperation is central to advancing sustainable development.

Yet, these threats come at a time when international cooperation and governance are more important than ever – many of the challenges laid out in the 2030 Agenda for Sustainable Development are global by nature and require collective and cooperative action. Waning support for multilateralism also raises questions around the capacity for collaborative policy action in the event of a widespread global shock.

UN report spotlights ‘uneven progress’

According to the WESP report, published by the UN Department of Economic and Social Affairs, more than half the world’s economies saw growth accelerate in 2017 and 2018.

Developed economies grew at 2.2 per cent in both years, while unemployment rates dropped.

Among developing economies, East Asia and South Asia saw the strongest gains in 2018, at 5.8 per cent and 5.6 per cent respectively, while commodity-exporting countries continued their “gradual recovery”.

This improvement was particularly true for fuel-rich emerging nations, despite high debt levels caused by a fall in commodity prices, in 2014-15.

Although the overall picture among developing economies is largely positive, many are nonetheless experiencing “uneven progress”, the UN report cautioned, amid falling individual (per capita) wealth in several nations.

“Further declines or weak per capita growth are anticipated in 2019 in Central, Southern and West Africa, Western Asia and Latin America and the Caribbean – homes to nearly a quarter of the global population living in extreme poverty,” it noted.

And even where growth is strong, it is “often driven by core industrial and urban regions”, the WESP 2019 report continued, such that rural areas are being left behind.

To overcome this, and for poverty to be eradicated by 2030, the UN report suggests that there will need to be “both double-digit growth in Africa” along with “steep reductions” in unequal pay levels. – TradeArabia News Service




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