Even before the recent G20, Atradius released the Global Economic Outlook from which it emerges that, after a strong expansion in 2017, the global economic momentum has remained at the same levels this year, even if it is expected to progressively lose ground in 2019. The risks for the growth of goods and services are increasing , not only due to the US-China trade escalation, perhaps partially defused by the G20 truce, but also due to the crisis of various emerging economies such as the Brazil and for the implementation of populist economic policies in Italy.
Rising uncertainty could strain global investment, a major driver of trade. As such, global trade is expected to move from a notable 4,6% expansion recorded in 2017 to a more modest 3,7% this year, to decline further to 3,0% in 2019. In an increasingly interconnected environment, it is clear that the room for policy error is extremely limited, with the consequences of decisions taken at the national level having regional and global repercussions, particularly as regards trade and investment. Thus, world GDP growth is expected to accelerate slightly from 3,0% to 3,1% in 2018, with a stabilization of 2,8% next year.
Analysts see the US economy growing by 2,9% this year, thanks to fundamentals strengthened by fiscal stimulus policies, before slowing to 2,5% in 2019. The Eurozone continues to struggle, with a momentum that next year it will go from 2,0% to 1,7%. The British economy is slowing down to 1,3%, a level that should be confirmed (+1,5%) also in 2019 if Brexit proceeds as envisaged in the latest agreements and without shocks. In this context, emerging market economies (EMEs) are also slowing down, with growth stable at 4,5% and 4,4% over the next two years.
Emerging Asia will be the engine of growth, but it too is losing pace with growth expected at +5,6% in 2019 from 6,0% this year. Moderate accelerations are expected only in sub-Saharan Africa and in Latin america.
Nonetheless, as global economic momentum continues to pick up, analysts expect a further 4% drop in insolvencies in advanced economies. However, if the GDP forecasts are confirmed, insolvencies are expected to decrease by 2019% in 1. The global scenarios are threatened by downside risks, the most important of which comes from the difficult truce on US-China tariffs. The second highest risk is Fed policy which could curb US economic activity and cause financial turmoil largely at the expense of EMEs. Further problems could arise from the correction of the financial market, the upward trend in oil prices and a sharp slowdown in the Chinese economy.
Political uncertainty in the Eurozone is also increasingly clouding its prospects for stability, particularly in the face of populist scenarios unfolding in theCentral-Eastern Europe and amplified by the last Italian elections. The outlook in the UK points to slow but resilient growth, where however the risk remains that they will be misled by a failure to ratify agreements with the EU. At the same time, Asian markets are losing momentum due to the slowdown in China and global trade. Overall, the outlook for EMEs remains bright over the forecast period, but excessive vulnerability to external developments continues to cloud the outlook for individual countries, as evidenced by capital outflows and writedowns this year. And as the deterioration of international trade scenarios proceeds, these markets find themselves increasingly dependent on domestic demand, a factor which in recent years has translated into the emergence of governments with a clear populist matrix. With the risk that costs will continue to fall on the productive activities of companies and the danger of a vicious circle of recession and insolvencies in the medium term.
