Key indicators: IMF downgrade is bad news for Danish businesses
Air is leaking from the global growth balloon, and Europe will be especially hard-hit. That is the latest forecast from the International Monetary Fund, and it may take a toll on Danish exports, says Senior Analyst at the Confederation of Danish Industry Allan Sørensen.
The International Monetary Fund (IMF) projects that the world economy will grow by 3.5 per cent in 2019 and 3.6 per cent in 2020. This is a downwards revision from the previous forecast in October, which projected growth of 3.7 per cent both years.
In the euro area growth has been revised down from 1.9 to 1.6 per cent in 2019. The IMF has reduced growth projections for Germany and Italy in particular.
“The IMF has downgraded its global growth outlook, and that is bad news for Danish businesses. The prospect of slower growth in Europe is particularly concerning, because that is our main export partner. For both companies and consumers, confidence in the European economy has plummeted over the past year, indicating that growth in Europe is slowing,” says Allan Sørensen, Senior Analyst at the Confederation of Danish Industry.
The global growth outlook no longer looks as rosy as it once did. Senior Analyst at the Confederation of Danish Industry Allan Sørensen
“There is currently great economic and political uncertainty all over the world. This is largely due to Brexit, the US-China trade war, the US government shutdown and weak economic indicators in Germany,” says Allan Sørensen.
“The global growth outlook no longer looks as rosy as it once did. But despite downgraded projections, the world economy is still expected to grow, and we must convert this into increased exports. 2018 was a weak year for Danish exports, and if we are to keep the upswing going, a comeback is necessary in 2019,” says Allan Sørensen.
“In the US, the upswing continues. But two years into Donald Trump’s presidential term, growth is threatened by stalled budget negotiations, the trade war with China, uncertainty and an increasing labour shortage,” says Allan Sørensen.