The global economy has suffered tough times in the year 2016. Due to a rising political uncertainty, the overall economy in the world has surged for only 2.3%. It could have been better and higher if unprecedented political events such as the controversial Brexit, the closely watched US Presidential elections, and the national elections in the parts of Europe did not derail the growth. From this under performance, can the global economy in 2017 improve?
Seeing the Light
Sure the year 2017 cannot escape the uncertainties from major political and economic events. Though it would not be as heavy as Brexit, it would still impact the financial status of the world. Despite this, the World Bank sees a steadier and stronger performance for global economy in 2017.
The institution expects the global economy to leap from 2.3% in the previous year to 2.7% this year should the manufacturing and trade continue to pick up and prices of commodities become stable. Now with less political tensions (at least on the first half), market confidence is on the rise, which can boost investments and propel the financial market.
This surge will be backed up by a key growth both in the emerging markets such as China, India and Russia, and the developed markets such as US and Australia. Both markets are expected to contribute the biggest gains this year as they will jump to 4.1% from 3.5%.
The world’s second largest economy is seen to tack on 6.5%, with its industrial sector expected to lead the charge. But all eyes will be on the world’s biggest economy, the United States, as its economic and trade policies produce great impacts to the rest of the world, with investors still waiting for President Donald Trump’s tax cut reform and increase in government spending.
As the financial markets become more challenging, a sound, systematic and cyclical policies will be a crucial player in this year’s quest. Hence, if major market players stick to it, then the global economy in 2017 is on track for a stronger growth.