OECD raises economic growth outlook, warns of protectionism

The Organization for Economic Cooperation and Development (OECD) forecasts that the world economy will grow steadily in the next two years if protectionism does not disrupt the trade recovery.

In its latest economic outlook report released on December 4, the OECD forecast that the global economy will grow 3.2% this year and 3.3% in 2025 and 2026.

Growth next year is up slightly from the OECD’s last report in September, when it forecast the world economy to expand by 3.2% this year and in 2025. The report, released on December 4, said that after global trade slowed last year, trade is recovering and trade volume growth is expected to reach 3.6% next year, despite import restrictions.

PSA International Terminal in Singapore

“Rising trade tensions and moves toward protectionism could disrupt supply chains, raise consumer prices and negatively impact growth,” the OECD report said.

The outlook for global trade has been thrown into doubt by US President-elect Donald Trump’s public announcement of plans to raise tariffs on several major trading partners. In the US alone, the OECD forecasts US growth will slow from 2.8% this year to 2.4% in 2025 and 2.1% in 2026, partly due to a stable job market and reduced spending.

For the world's second-largest economy, China, growth is forecast to slow from 4.9% in 2024 to 4.7% in 2025 and 4.4% in 2026. The OECD said that despite Beijing's loose monetary and fiscal policies, consumers are tending to save as a precaution against economic uncertainty.

Meanwhile, in the eurozone, investment will benefit from central bank easing that could boost consumer spending, pushing regional growth from 0.8% this year to 1.3% in 2025 and 1.5% in 2026. Over the same period, UK growth is forecast to rise from 0.9% to 1.7%, before slowing to 1.3%.

As inflation eases, most major central banks around the world will gradually ease monetary policy cautiously, the OECD said. In addition, governments are expected to take decisive action to tackle public debt as public spending comes under pressure.

Source: https://thanhnien.vn/oecd-nang-trien-vong-tang-truong-kinh-te-canh-bao-ve-chu-nghia-bao-ho-185241204211012295.htm