KZN growth prospects should be better this year

THE prospects for economic growth in Kwazulu-natal should be better this year than last year despite a marginal slowdown in global growth, as the province usually outperforms the national economy.

Global economic growth is forecast to slow to 2.9 percent this year from an expected 3 percent last year according to the World Bank.

International trade and manufacturing activity have softened, trade tension remains elevated, and some large emerging markets have experienced substantial financial market pressures, the multilateral development finance institution said this week in its January 2019 Global Economic Prospects report.

“At the beginning of 2018, the global economy was firing on all cylinders, but it lost speed during the year and the ride could get even bumpier in the year ahead,” World Bank chief executive Kristalina Georgieva said.

At the October 2018 International Monetary Fund/world Bank meeting in Bali, Indonesia, several economists warned that there would be slower growth this year than last year, mostly due to the trade war between the US and China.

The SA Reserve Bank in November forecast economic growth of 1.9 percent for this year. “The global economic outlook is expected to remain broadly favourable over the short term. However, medium-term risks are tilted to the downside due to less synchronised global growth. This is amplified by elevated policy uncertainty emanating from escalating trade tension, tightening global financial conditions and rising geo-political risks,” it said.