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STORY: UN / WORLD ECONOMIC PROSPECTS
TRT: 2:03
SOURCE: UNIFEED-UNTV
RESTRICTIONS: NONE
LANGUAGE: ENGLISH /NATS
DATELINE: 12 MAY 2016, NEW YORK CITY
RECENT
1. Med shot, exterior, UN flag
12 MAY 2016, NEW YORK CITY
2. Wide shot, press briefing
3. SOUNDBITE (English) Lenni Montiel, Assistant Secretary-General for Economic Development, Department of Economic and Social Affairs of the United Nations:
“Our update paints a bleak picture of the world economy. Week global growth continues to linger with little prospect for turnaround this year. The world economy is expected to grow by just 2.4 percent - the same low rate as in 2015.”
4. Cutaway, reporters
5. SOUNDBITE (English) Lenni Montiel, Assistant Secretary-General for Economic Development, Department of Economic and Social Affairs of the United Nations:
“As we embark on the implementation of the 2030 Agenda for sustainable development, the bleak state of the world economy clearly poses significant challenges for member states around the world, but certainly for the United Nations development system.”
6. Cutaway, reporters
7. SOUNDBITE (English) Lenni Montiel, Assistant Secretary-General for Economic Development, Department of Economic and Social Affairs of the United Nations:
“For the world economy it would be challenging to grow without necessary increases in investment rates which has shown renewed signs on weakness in many large economies. The level of investment needed to make significant progress towards the sustainable development goals remains worryingly inadequate in this environment of week global growth.”
8. Cutaway, photographer
9. SOUNDBITE (English) Lenni Montiel, Assistant Secretary-General for Economic Development, Department of Economic and Social Affairs of the United Nations:
“The developed economies have relied far too long on a single strand of micro-economic policy and it is clear that further monetary stimulus on its own will not lead to growth. More robust fiscal stands, especially if coordinated among the largest economies could provide much needed impetus to the global economy among other policy options.”
10. Wide shot, press room
The latest mid-term UN report on economic prospects on the world economy says that global growth remains lacklustre, with little prospect for a turnaround in 2016.
According to the report, the world gross product is projected to grow by just 2.4 per cent in 2016, the same pace as in 2015, marking a downward revision of 0.5 percentage points from UN forecasts released in December 2015.
Persistent weakness in aggregate demand in developed economies remains a drag on global growth, while low commodity prices, mounting fiscal and current account imbalances and policy tightening have further dampened prospects for many commodity-exporting economies in Africa, the Commonwealth of Independent States and Latin America and the Caribbean.
This has been compounded by severe weather-related shocks, political challenges and large capital outflows in many developing regions.
Launched today (12 May) in New York, Lenni Montiel, Assistant Secretary-General in the United Nations Department of Economic and Social Affairs (DESA) said “as we embark on the implementation of the 2030 Agenda for sustainable development, the bleak state of the world economy clearly poses significant challenges for member states around the world, but certainly for the United Nations development system.”
The report further highlights the prolonged economic downturns in Brazil and the Russian Federation, with significant regional spillovers. In the Russian Federation, GDP is forecast to contract by 1.9 per cent in 2016, due to fiscal tightening, further declines in private consumption and investment, and continuing international sanctions. In Brazil, a contraction of 3.4 per cent is projected, reflecting a deepening political crisis, rising inflation, a surging fiscal deficit and high interest rates. GDP growth in the least developed countries is forecast to reach just 4.8 per cent in 2016 and 5.5 per cent in 2017, well below the Sustainable Development Goal target of “at least 7 per cent GDP growth”.
This may put at risk much needed public spending on education, health and climate change adaptation, as well as progress in poverty reduction. In per capita terms, the slowdown in GDP growth in many developing regions is particularly stark.
In Africa, GDP per capita growth is expected to average just 0.4 per cent during 2015-2017. On the positive side, global energy-related carbon emissions remained flat in 2015, suggesting a potential delinking of economic growth and carbon emissions growth as highlighted in World Economic Situation and Prospects 2016.
Investments in renewable energy sources reached a new record in 2015, mainly due to increased commitments and policy support in many developing countries. Global growth is projected to rise marginally to just 2.8 per cent in 2017, remaining well below pre-crisis trends.
The protracted period of slow productivity growth and feeble investment weigh on the longer-term potential of the global economy. The report warns that downside risks to the global economy remain elevated. Large developing economies remain prone to capital flow volatility and exchange rate pressures, which may intensify in response to a widening divergence in global interest rates, while a further deterioration of commodity prices could exacerbate debt-service burdens of certain commodity-dependent economies.
The report recommends that governments should fully and effectively utilize available fiscal space, while broadening the tax base, strengthening tax administration and increasing compliances in many developing and transition economies.
