In the opinion of the International Monetary Fund (IMF), the global economy will continue to grow in 2012 despite the elevated risks. The IMF forecasts that world GDP will rise by 3.3 percent. For 2013, the IMF predicts 3.9 percent. This upward trend will be supported by emerging economies, which will achieve 5.4 percent growth in 2012. Since late 2011, both Brazil and China have been implementing monetary easing to prevent a growth slump in their domestic markets. The same is happening in Indonesia. The objective is to prevent a marked weakening of economic activity in these emerging countries. Advanced economies will contribute only 1.2 percent GDP growth in 2012.
Moderate Growth for US Economy
Economic growth in the USA in 2012 will remain at the prior-year level. The Organisation for Economic Co-Operation and Development (OECD) expects growth of 1.8 percent there. For 2013, the OECD estimate is 2.2 percent.
Sources – worldwide: IMF; USA: OECD; Asia: ADB; China: IMF; India: ADB; Japan: OECD; Europe: IMF; Germany: IMF (Dec. 2011)
Growth Prospects in Asia Remain Good
Asia will again deliver much higher growth rates than all other regions over the next two years. The Asian Development Bank (ADB) anticipates growth of 7.5 percent despite having downgraded its forecast for 2012. India and China remain the driving forces behind this development. According to the IMF, output is expected to go up 8.2 percent in China, with a gain of 8.3 percent in 2013. The ADB forecasts an increase of 8.8 percent for India. In Japan, GDP could grow by 2.0 percent in 2012 after 2011’s earthquake. The OECD predicts growth of 1.6 percent there for 2013.
Growth in Europe Held Back by Sovereign Debt
Europe – according to IMF estimates – will see GDP significantly dampened by sovereign debt in 2012 and will fall into a recession. The IMF anticipates negative GDP growth of -0.5 percent for 2012 but takes a more positive view of developments in 2013. Growth in the eurozone should then reach 0.8 percent. Analysts are slightly more optimistic about Germany’s prospects for 2012. Economic output there is likely to grow by 0.3 percent, followed by 1.5 percent in 2013.