The Organization OECD sees difficult times on the global economy coming. "The prospects are becoming increasingly fragile and uncertain," according to the economic outlook published by the Organization for Economic Co-operation and Development (OECD).
Above all, the trade conflict between the US and China weighed on the economy. According to the OECD, the global economy is expected to grow by only 2.9 percent in the 2019 calendar year. In May, she had expected a plus of 3.2 percent. Last year, the global economy grew by 3.6 percent.
Trade conflicts hit Germany particularly hard
For the Eurozone and the US, the forecasts for the current and the coming year have been lowered. The OECD is particularly skeptical about Germany. Here, the forecast for the current year was reduced by 0.2 points to 0.5 percent. Expectations for 2020 have been lowered even more: only an increase in gross domestic product (GDP) of 0.6 percent is expected. In May, the OECD was still at 1.2 percent.
Also the Brexit could be a big risk
As an export-oriented economy, Germany was hit particularly hard by the trade conflicts. The OECD talks of escalating trade tensions that put a strain on confidence and investment. Increasing political uncertainty threatens the prospects. So far, especially the industry suffered from the trade conflicts.
In China, the OECD expects a slowdown in economic activity. However, according to the OECD there is a danger of a stronger downturn. This could lead to a longer phase of weak import demand.
The OECD sees a big risk with regard to the United Kingdom. A Brexit without agreement could plunge the country into recession next year. This would significantly reduce growth across Europe.