Nordic growth con­ver­gence

Financial Mirror (Cyprus) - - FRONT PAGE -

The world econ­omy is still char­ac­terised by low growth, and un­cer­tainty is high par­tic­u­larly as re­gards the ef­fects of Brexit, the US pres­i­den­tial elec­tion and the geopo­lit­i­cal sit­u­a­tion. Nordea ex­pects the Nordic re­gion to grow in line with other ad­vanced economies.

Nordea’s new eco­nomic fore­cast projects global growth of 3.0% this year and around 3.2% in 2017 and 3.3% in 2018.

The growth is driven by Emerg­ing Mar­kets where the out­look for many coun­tries is im­prov­ing as com­mod­ity prices sta­bilise. How­ever, growth in the ad­vanced economies will stag­nate over the fore­cast hori­zon. All in all, the global econ­omy is likely to see rel­a­tively slow growth in the years ahead, said Helge J. Ped­er­sen, Nordea’s Group Chief Econ­o­mist.

In the Nordic coun­tries, eco­nomic growth in Swe­den has in re­cent years been sig­nif­i­cantly higher than in other coun­tries. But now growth ap­pears to be fall­ing in Swe­den, while in­creas­ing in the other coun­tries. The slow­down of the Swedish econ­omy is mainly due to lower ex­ports. Do­mes­tic de­mand has shown strong growth over the past years, but pri­vate con­sump­tion is likely to shift into a lower gear next year as the ef­fects of stim­u­lus mea­sures have be­gun to fade.

In Nor­way, eco­nomic key fig­ures have over the sum­mer been on the strong side. Un­em­ploy­ment ap­pears to have peaked and house prices rise more than ex­pected. Main­land growth will pick up as the fall in oil in­vest­ment now seems to ta­per off. That will help the in­dus­tries af­fected by the oil slump. Mean­while, we ex­pect the rest of the econ­omy, which has held up well dur­ing the oil down­turn, to grow at a healthy clip go­ing for­ward.

In Den­mark, we ex­pect slightly more pos­i­tive tail­winds over the next cou­ple of years as re­cent years’ in­crease in em­ploy­ment bol­sters con­sump­tion and in­vest­ment ac­tiv­ity. The big­gest threats to higher growth mainly come from abroad be­cause of the sub­dued global trade.

Only frag­ile growth lies ahead for the Fin­nish econ­omy in the next few years. After reach­ing 1% in 2016, growth is ex­pected to mod­er­ate again. The ex­port out­look re­mains dim due to low global growth and weak world trade.

Newspapers in English

Newspapers from Cyprus

© PressReader. All rights reserved.