Published: Tue, March 13, 2018
Business | By Tara Barton

S. Korea to maintain 3% growth for 2018-2019: OECD

S. Korea to maintain 3% growth for 2018-2019: OECD

An escalating trade war is one of the only things standing in the way of the global economy growing at its fastest pace since 2010 this year and next, according to the influential Organisation for Economic Co-operation and Development (OECD).

The UK trails last out of the G20 economies in OECD growth projections for both 2018 and 2019, with Britain's rate of GDP increase declining in both years while many other countries surge ahead.

"The world economy will continue to strengthen over the next two years", the OECD said.

"I think it is very important to avoid escalation and to initiate a strengthening in the global dialogue to solve not only the problem for steel but to avoid bigger repercussions in terms of trade". The figure for next year was also increased from 3.6 percent to 3.9 percent. Previously, the OECD had forecast 2.1 percent and 1.9 percent respectively.

Rebounding global business investment would keep global trade growth at about 5 percent this year, the OECD forecast.

And while eurozone growth is expected to ease off from 2.5% a year ago to 2.3% in 2018 and 2.1% in 2019, major continental economies like Germany and France are forecast to out-perform the UK. The Paris-based organization had expected growth to be 1.2 percent in 2018 and 1.0 percent in 2019.

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"In Japan, where underlying inflation and inflation expectations remain low, current stimulus measures need to be continued to help achieve the inflation target", the OECD said.

The latest round of protectionism was triggered by US steep tariffs on imported steel and aluminum.

"Safeguarding the rules-based global trading system will help to support growth and jobs", it said.

The raised forecast was in part due to expectations that USA tax cuts would boost the world's biggest economy, it said.

The eurozone economy will likely see a robust and broad-based expansion, with growth in gross domestic product estimated at 2.3 percent this year and 2.1 percent next year. The world's largest economy is expected to grow 2.9 percent this year and 2.8 percent next year.

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