Our forecast of world output growth this year is unchanged at 3.0 per cent – the slowest annual growth rate since the 2009 recession. World growth is expected to strengthen to 3.2 per cent next year and 3.6 per cent in 2018, but to remain slower than before the global financial crisis.
Downside risks to the forecast include economic downturns in the advanced economies that central banks may lack ammunition to counter, as well as financial instability as a result of low and negative interest rates. These point to a need for more balanced policies to promote expansion, with fiscal policy playing a greater role.
With trade growth in recent years already reduced to half its pre-crisis rate, action to resist protectionist pressure and to promote further progress with international economic integration is vital.