This chart shows how hard Trump's trade war is hammering global growth
- The OECD on Thursday released a warning to the global economy - GDP growth is going to drop, and it's up to governments to stop fighting to fix it.
- In a statement, the OECD said that world GDP growth this year is expected to fall to 2.9%, "its lowest annual rate since the financial crisis," and is expected to hover at that level in 2020 and 2021.
- The OECD highlighted the US-China trade war as the reason for this decline.
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The Organisation for Economic Cooperation and Development (OECD) on Thursday released a warning for the global economy - GDP growth is going to drop, and it's up to governments to stop fighting to fix it.
In its latest economic outlook, the OECD said that world GDP growth this year is expected to fall to 2.9% - "its lowest annual rate since the financial crisis," and is expected to hover around that level through 2020 and 2021.
The OECD blamed a lack of trade for the economy slowing, saying that "bold action is needed" in order to solve high levels of business uncertainty.
"Governments must work together urgently to boost investment and establish fair international rules on taxation and trade," the OECD said in a statement on Thursday.
The OECD highlighted the US-China trade war as the reason for this decline.
"Two years of escalating conflict over tariffs, principally between the US and China, has hit trade, is undermining business investment and is putting jobs at risk," the Paris based organisation said.
"It would be a mistake to consider these changes as temporary factors that can be addressed with monetary or fiscal policy: they are structural," said OECD Chief Economist Laurence Boone in the statement. "Without coordination for trade and global taxation, clear policy directions for the energy transition, uncertainty will continue to loom large and damage growth prospects."
Earlier this week, Goldman Sachs released a series of charts showing the impact on GDP in both the US and America on the effects of the trade war - both sides had taken a hit, China more so. Maersk, the world's largest shipping company, warned that the global trade slump is likely to stay in 2020, echoing the OECD.
The OECD also highlighted in its report that certain countries will struggle. Countries including the US, India, and Argentina saw GDP projections revised lower this year, while 2020 growth projections in Europe, Saudi Arabia and Indonesia dropped.
The OECD warned that "any further escalation of the trade conflict would disrupt supply networks and weigh on confidence, jobs, and incomes."
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