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S. Korea to maintain 3% growth for 2018-2019: OECD

13 March 2018

On its latest forecasts, the OECD said "stronger investment, the rebound in global trade and higher employment are helping to make the recovery increasingly broad-based".

While broadly more optimistic than only a few months ago, the Organisation for Economic Cooperation and Development warned a trade war could threaten the outlook, and forecast that United Kingdom growth would lag all G20 countries due to Brexit uncertainties.

The global economy will grow close to 4 per cent this year and next, better than previously anticipated, according to the OECD, which added a warning that a trade war could roll back the gains seen in recent years.

The UK trails last out of the G20 economies in OECD growth projections for both 2018 and 2019, with Britain's rate of GDP increase declining in both years while many other countries surge ahead.

U.S. President Donald Trump last week formally signed proclamations to impose a 25-percent tariff on imported steel and a 10-percent tariff on aluminum, causing mounting dissent among business groups and trading partners around the world.

The higher forecast was in part due to expectations that USA tax cuts would boost economic growth there, it said.

Trump, Kim have reasons to be civil
Trump has also ribbed Kim on social media frequently, only heightening global tensions. But he says the USA does expect to hear directly from Pyongyang .

With tax cuts boosting the economy this and next year, the OECD forecast the upper bound of the target federal funds rate could reach 3.25 percent by the end of 2019 from 1.5 percent now.

"Growth is steady or improving in most G20 countries and the expansion is continuing", the group said.

For South Africa, the OECD has revised the expected GDP growth rate upward to 1.9% in 2018, and 2.1% in 2019 - higher than the growth rate now targeted by National Treasury.

Growth in France is expected to hit an 11-year high of 2.2 per cent this year before easing to 1.9 per cent in 2019.

"In Japan, where underlying inflation and inflation expectations remain low, current stimulus measures need to be continued to help achieve the inflation target", the OECD said. "Safeguarding the rules-based global trading system is key".

National Treasury now anticipates growth of 1.5% in 2018, rising to 2.1% in 2020. "Governments of steel-producing economies should avoid escalation and rely on global solutions".

S. Korea to maintain 3% growth for 2018-2019: OECD