Five reasons the global economy could do better than expected
SINGAPORE (Nov 11): A quick scan of the headlines shows continued pessimism about the world economy. Respected international organisations such as the World Bank and the International Monetary Fund (IMF) have downgraded their forecasts for global growth and many institutions with super-duper forecasting models have also chimed in with downbeat prognostications. On the surface, this makes sense since the downside risks sound pretty intimidating: a nasty trade war, weaker momentum in some large economies such as the eurozone and China and some formidable geopolitical risks.
In response, we would say three things. First, there are convincing reasons for an upside surprise in economic growth around the world. Second, the recovery will be modest but still positive for all of us; however, the benefits for Asia in terms of stronger exports may take time to emerge. And so, third, Asian policymakers still have much work to do to support the region’s prospects — and in this respect, they are doing fairly well.
