Global Economy Expected to Grow 3% in 2019 Despite Risks - World Economic Situation and Prospects

Speakers: Mr. Elliott Harris, UN Chief Economist and Assistant Secretary-General for Economic Development and Dawn Holland, Chief, Global Economic Monitoring Branch, Economic Analysis and Policy Division, Department of Economic and Social Affairs (EPAD/DESA). The World Economic Situation and Prospects (WESP) report is a joint product of the United Nations Department of Economic and Social Affairs (UN/DESA), the United Nations Conference on Trade and Development (UNCTAD) and the five United Nations regional commissions (Economic Commission for Africa (ECA), Economic Commission for Europe (ECE), Economic Commission for Latin America and the Caribbean (ECLAC), Economic and Social Commission for Asia and the Pacific (ESCAP) and Economic and Social Commission for Western Asia (ESCWA)). WESP Report website: https://www.un.org/development/desa/dpad/document_gem/global-economic-monitoring-unit/world-economic-situation-and-prospects-wesp-report/ UN Chief Economist Elliott Harris said while global economic growth remained on a fairly steady trajectory in 2019, “the world economy is faced with a confluence of rising risks with the potential to severely disrupt economic activity and inflict significant damage on longer term development prospects.” Harris spoke to reporters in New York today (21 Jan) on the findings of the UN’s annual World Economic Situation and Prospects report (WESP). The report projected that economic activity was expected to expand at a steady pace of three percent and found that unemployment rates had dropped to historic lows in many countries. However, Harris said a closer look beneath the surface reveals significant issues with the foundations and quality of global economic growth. He said growth is “uneven, and it is often failing to reach the countries and the groups where it is most needed” with per capita incomes expected to “stagnate or grow only marginally in 2019 in several parts of Africa, Western Asia, and Latin America and the Caribbean.” He said international trading tensions escalated, particularly between the United States and China, while public and private debt has risen to historic highs. The Chief Economist said while adverse effects have been largely contained, these factors cast a shadow over the economic outlook for 2019 and beyond. Elliott Harris, UN Chief Economist and Assistant Secretary-General for Economic Development: “In the case of a downturn in global economic activity, policy makers around the world will struggle to react forcefully because monetary and fiscal space in many countries is now much more limited than it was at the outbreak of the global financial and economic crisis a decade ago. And, given the waning support for multilateral approaches, coordinated action in response to the shock, or any shock, similar to the response to the global financial crisis may be more difficult to achieve.” Harris said long-term challenges such as climate change “have now become increasingly short-term ri