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- Global trade is likely contracting and we’re now ‘betting’ on a US-China deal - OECD chief
Global trade is likely contracting and we’re now ‘betting’ on a US-China deal - OECD chief
Investment and trade growth at the moment are reliant on a deal between the U.S. and China, the secretary general of the Organisation for Economic Cooperation and Development (OECD) told CNBC.
“Yesterday, President Donald Trump said ‘Yes, maybe we’re close to a deal with China’ — we’re betting on that,” Angel Gurria told.
“The rate of growth of trade has come down from 5.5% in 2017 to basically flat. In fact, maybe as we speak, trade is going negative, it’s contracting. Investment — as a consequence because of the uncertainty — went from 5% growth to about 1% growth now and it’s slowing down further.
“Therefore growth has dropped precipitously over a short period of time,” he said.
Gurria told that “if we continue to take decisions along the lines of more protectionism or more problems with trade etc, if there are more tensions, then the consequences can be even worse.”
Then, in its “Interim Economic Outlook,” the organization warned that “global economy has become increasingly fragile and uncertain, with growth slowing and downside risks continuing to mount.” It said economic prospects were weakening for both advanced and emerging economies, “and global growth could get stuck at persistently low levels without firm policy action from governments.”
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