(FE)
Globalisation has pervaded each economy so comprehensively that all economic events have lost country-specific features, as upward or downward event no longer remains confined within a geographic limit. This was truly evident in the latest World Economic Outlook report of IMF as it has coined the term ‘synchronised slowdown’ to describe the global economic movement in the recent period and make projections for next year.
Global GDP is to come down to 3.0% against 3.3% projected in April ‘19. This slowdown in growth is contributed by EU (from 1.3% to 1.2% ), China (from 6.3% to 6.1%), Japan (from 1.0% to 0.9% ), Brazil (from 2.1% to 0.9% ) and India (from 7.3% to 6.1% ). One of the major reasons for the economic downturn across the globe indicated by IMF relates to uncertain and fluctuating global trade and the vicious implications for merchant trade, capacity creation, job losses and massive indebtedness among the nations, arising out of the trade wars between the two large economies — the US and China. The trade conflict that was simmering for the last one decade, as evidenced by the rising number of trade disputes, resulted in innumerable numbers of trade measures among the trading partners and culminated in mid-March 2018 with announcement by the US to impose 25% tariff on all steel imports to the US. As retaliation, China announced additional tariff on all US exports which included agriculture, software packages and instruments, machinery and equipment and had a disastrous implication for the US investment in China and vice-versa.
