International Monetary Fund raises global growth outlook amid Trump tax cuts

International Monetary Fund raises global growth outlook amid Trump tax cuts”

The International Monetary Fund Monday raised its growth projection for the deficit-hit Saudi economy on the back of higher oil prices but retained its estimates for the region.

The figures were released in World Economic Outlook (WEO) update which was released, in Davos on the sidelines of the World Economic Form (WEF), today.

Cape Town - Solid growth in advanced economies is expected to propel the world's economy to register strong growth in both 2018 and 2019, the latest IMF World Economic Outlook report has shown.

The IMF cited increased investment as businesses take advantage of lower corporate tax rates as it projected USA growth to increase to 2.7 per cent this year, from 2.3 per cent in 2017.

Global growth is projected to pick up in the near term mainly due to continued momentum in advanced economies and the expected impact of changes to the US tax code.

It is true that impact of braking is controlled: it goes from 3.1% registered in 2017 to 2.4% this year, and for 2019 economy will grow slightly more than expected, up to 2.1%, one tenth above what was calculated in October, probably under premise that Incertidu Name policy will have remitted.

India was the fastest growing country among emerging economies in 2016.

It noted that global economic activity has continued to firm up since mid-2016 and that output is estimated to have grown by 3.7 percent in 2017, which is 0.1 percent faster than projected in the fall and 0.5 percent higher than in 2016. Absent reforms, the fundamental forces that had us anxious about the "new mediocre" - and future growth potential - will remain in place, she said.

"Global growth has been accelerating since 2016, and all signs point to a continuous strengthening of that growth", International Monetary Fund managing director Christine Lagarde said during a news conference at the World Economic Forum's annual meeting in Davos, Switzerland. The new policies prompted the fund to raise its real GDP estimates for the 2.7% for this year from a previous 2.3%, and to 2.5% in 2019 from an earlier 1.9%. The region continues to account for over half of world growth.

The IMF said even though the economic "rebound could prove stronger in the near term", the risks to the global forecast remain tilted to the downside.

Corruption allegations under the leadership of President Jacob Zuma have hurt investor confidence in South Africa, with economic growth slowing to a near-standstill in recent years. "In an environment of financial market optimism, ensuring financial resilience is imperative".

The IMF said the current cyclical upswing provides an ideal opportunity for reforms. "Multilateral cooperation remains vital for securing the global recovery", it said.

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