Global economy facing hesitant and uneven recovery
- Published on Tuesday, 27 November 2012 10:45
- Posted by Scott Buckler
The global economy is expected to make a hesitant and uneven recovery over the coming two years. Decisive policy action is needed to ensure that stalemate over fiscal policy in the United States and continuing euro area instability do not plunge the world back into recession, according to the OECD's latest Economic Outlook
"The world economy is far from being out of the woods," OECD Secretary-General Angel Gurría said during the Economic Outlook launch in Paris. "The US 'fiscal cliff', if it materialises, could tip an already weak economy into recession, while failure to solve the euro area crisis could lead to a major financial shock and global downturn. Governments must act decisively, using all the tools at their disposal to turn confidence around and boost growth and jobs, in the United States, in Europe, and elsewhere," Mr Gurría said.
GDP growth across the OECD is projected to match this year's 1.4% in 2013, before gathering momentum to 2.3% for 2014, according to the Outlook.
In the United States, provided the "fiscal cliff" is avoided, GDP growth is projected at 2% in 2013 before rising to 2.8% in 2014. In Japan, GDP is expected to expand by 0.7% in 2013 and 0.8% in 2014. The euro area will remain in recession until early 2013, leading to a mild contraction in GDP of 0.1% next year, before growth picks up to 1.3% in 2014.