Global growth expected be 3.9 percent in 2018 and 2019

Miftah leaves for Washington to attend IMF, WB meetings

Keeping its growth predictions unchanged for India, the International Monetary Fund (IMF) on Tuesday said the country's GDP would grow at 7.4 per cent in 2018 and to further grow to almost 8 per cent in 2019.

China is expected to grow respectively at 6.6 and 6.4 per cent in the two years.

"The IMF welcomed New Zealand's continued support of open trade and our multi-lateral trade framework saying that, as one of the initial signatories of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), New Zealand will benefit from increased market access and new growth opportunities".

Back in 2015 the economy was reported as growing by 26 per cent, leading some to claim it was a case of "leprechaun economics", as the sharp growth rate was largely down to the onshoring of IP by firms such as Apple.

It's noticeably less than the strong three per cent growth Canada experienced in 2017.

However, in the back-drop of prospects a trade-war between United States and China, the International Monetary Fund said that such a development threatens to undermine confidence and derail global growth prematurely.

He said the recent tax reform in the U.S. will make things worse, stating "we now expect the USA current account deficit for 2019 will be roughly $150 billion higher", as a result of the tax and spending changes introduced earlier this year.

According to the IMF, India has made progress on structural reforms in the recent past, including through the implementation of the GST, which will help reduce internal barriers to trade, increase efficiency, and improve tax compliance.

The world's second-biggest economy will continue rebalancing away from investment and manufacturing toward consumption and services, International Monetary Fund said, warning that rising debt clouds the nation's medium-term outlook.

"The main priorities for lifting constraints on job creation and ensuring that the demographic dividend is not wasted are to ease labour market rigidities, reduce infrastructure bottlenecks, and improve educational outcomes".

According to the WEO, growth in China and India previous year was supported by resurgent net exports and strong private consumption, respectively, while investment growth slowed.

In the Middle East, North Africa, Afghanistan, and Pakistan region, growth is forecast to rise from 2.6 per cent in 2017 to 3.4 per cent in 2018 and 3.7 per cent in 2019, but it will stabilise at about 3.6 per cent in the medium term.

Global growth is projected to pick up to 3.9% this year and next, supported by strong momentum, favourable market sentiment, accommodative financial conditions, and the domestic and worldwide repercussions of expansionary fiscal policy in the US.

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