The slowdown in global demand has reduced growth in OECD countries

Real GDP growth in the OECD area slowed to 0.2% in the second quarter of 2012, compared with 0.4% in the first quarter, according to figures released this morning by the OECD. In terms of the contributors to growth, the figures show that private consumption contributed 0.1 percentage point to GDP growth, compared with 0.3 percentage point in the previous … Continue reading

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World trade is being hit by the slowdown in global growth

The World Trade Organisation (WTO) has just slashed its forecasts for world trade expansion for this year to 2.5% from their previous forecast of 3.7% made in Arpil. Similarly their forecasts for 2013 have been reduced to 4.5% from 5.6%. “In an increasingly interdependent world, economic shocks in one region can quickly spread to others. Recently announced measures to reinforce … Continue reading

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Divergence in growth between US and Europe

Economic growth in the G7 countries is expected to be firmer through the first half of 2012, but the recovery remains fragile and will likely proceed at different speeds in North American and Europe, according to the OECD in its latest Interim Economic Assessment. The Assessment, presented in Paris by Chief Economist Pier Carlo Padoan, says the G7 economies are … Continue reading

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Protectionist pressures increasing

G20 governments have introduced more trade barriers, including export restrictions, in the past six months than in previous periods since the financial crisis began. This is according to a report by the World Trade Organization, the Organisation for Economic Co-operation and Development and the UN Conference on Trade and Development released yesterday. Although measures to lower trade barriers are also … Continue reading

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The truth about global exports

When we try to explain Ricardo’s theory of comparative advantage we invariably use a two country, two product example. Two hundred years ago, when Ricardo first put forward his theory of international specialisation and trade, it was really that simple. We produced something wholly within our country and sold it to their country. They produced something different, completely within their … Continue reading

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International Monetary Fund powerless to act

The word ‘war’ has been on the lips of international negotiators in recent months. This is nothing to do with Afghanistan or Iraq, but is just as significant. This is about the possibility of a global currency war. There are imbalances in the global economy which were at the heart of the recent collapse of the world economy. What are … Continue reading

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Warning of protectionist dangers from World Trade Organisation

In a recent report by Pascal Lamy, director-general of the World Trade Organisation (WTO), he noted the likely depth of the current recession and its impact on world trade. He said that in such circumstances “a large premium must be attached to avoiding policies that restrict world trade”. Although he could not see any immediate descent into high intensity protectionism … Continue reading

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The End is in Sight

So says a survey published this morning by the Ernst & Young Item Club. In its Spring Forecast it expects GDP to fall by 3.5% this year but by only 0.1% next year. It claims that the economy is no longer in “free fall” and that a recovery next spring is the most likely scenario.   Professor Peter Spencer, Chief … Continue reading

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World Bank slashes forecasts for growth and trade

The World Bank now predicts that global GDP growth will now contract by 1.7% in 2009, which means that world output will contract for the first time since the 2nd World War.   According to Hans Timmer, Manager, Global Trends in the World Bank’s Development Prospects Group: “Even if global growth turns positive again in 2010, we are not yet … Continue reading

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World trade to contract in 2009

“Trade has become another casualty of the global economic crisis” according to Pascal Lamy, director general of the World Trade Organisation, in a speech in Australia yesterday. He maintained that the slump in demand and the difficulties to access trade finance have led to a significant contraction of world trade. According to current estimates, world trade will contract by some … Continue reading

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