PARIS, Nov. 21 (Xinhua) -- In its latest economic outlook released on Thursday, the Organization for Economic Co-operation and Development (OECD) revised its 2020 global forecast to 2.9 percent, down from 3.0 percent in its previous forecast.
The Paris-based organization warned about the risk of long-term stagnation, blaming trade conflict, weak business investment and persistent political uncertainty.
World GDP growth is expected to be 2.9 percent this year, the slowest pace since the 2008 financial crisis. It expanded 3.5 percent in 2018.
Bold action is needed to address both the high levels of uncertainty facing businesses as well as the fundamental changes taking place in the global economy, said the OECD in its press release.
"It would be a mistake to consider these changes as temporary factors that can be addressed with monetary or fiscal policy: they are structural. Without coordination for trade and global taxation, clear policy directions for the energy transition, uncertainty will continue to loom large and damage growth prospects," said OECD Chief Economist Laurence Boone when presenting the Outlook in Paris.
Growth in the United States is forecast to slow to 2 percent in 2020 and 2021. In the euro area and Japan, growth is expected at around 1 percent.
In the euro area, affected particularly by increasing trade barriers due to its export-reliant economy, Germany's growth was projected to stand at 0.4 percent in 2020, down by 0.2 percentage point from previous outlook. Regarding France and Italy, the OECD upheld its forecast for next year at 1.2 percent and 0.4 percent respectively.
Global trade volume growth of goods and services is estimated to have slowed to decade-low level to 1 percent this year, OECD figures showed.
"Any further escalation of the trade conflict would disrupt supply networks and weigh on confidence, jobs and incomes. Uncertainty about a future EU-UK trade relationship poses a further risk to growth as does the current high level of corporate debt," it warned.