The world's economy is heading into "troubled waters," with a recession in 2020 now "a clear and present danger," a UN report released Wednesday (September 25) showed.
The United Nations Conference on Trade and Development (UNCTAD) Trade and Development Report 2019 said that even ignoring the worst downside risks, global growth is projected to fall to 2.3 percent in 2019, compared with 3 percent in 2018.
"Warning lights are flashing around trade tensions, currency movements, corporate debt, a no-deal Brexit and inverted yield curves but there is little sign that policymakers are prepared for the storm ahead," said the report.
It called for a focus on boosting jobs, wages, and public investment to replace policymakers' obsession with stock prices, quarterly earnings, and investor confidence.
"The slowdown in growth in all the major developed economies, including the US, confirms that relying on easy monetary policy and asset price rises to stimulate demand produces, at best, ephemeral growth, while tax cuts for corporations and wealthy individuals fail to trigger productive investment," said the report.
It said that trade growth is set to slow sharply this year following weakening global demand, compounded by the unilateral tariff actions of the US administration.
Trade growth dropped to 2.8 percent last year and is likely to be closer to 2 percent this year, said the report.
"The bigger concern, according to the report, is that 10 years on from the crisis, the global economy remains excessively financialized and fragile," it said. Xinhua