Welcome to ‘the Tepid Twenties’? The US economy’s strength won’t be enough to boost global growth
CNN
The global economy is at risk of stagnating in the coming years — and America’s robust economic strength may not be enough to save it.
The global economy is at risk of stagnating in the coming years — and America’s robust economic strength may not be enough to save it. “Without a course correction, we are indeed heading for ‘the Tepid Twenties’ — a sluggish and disappointing decade,” Kristalina Georgieva, the International Monetary Fund’s managing director, warned a few weeks ago. A lackluster performance in Europe and lukewarm growth in China (despite solid first-quarter data) are partly to blame. The good news is that despite major economic hurdles in recent years such as geopolitical conflict and high interest rates, a global recession isn’t in the cards. The bad news is that weak growth will leave many people feeling poorer. The solution: Policymakers around the world need to tackle a slew of economic issues, the IMF chief said. Invigorating growth is critical: When the economy expands, it improves standards of living, promotes innovation and makes households wealthier. That reality is slowly slipping away for the 20-nation eurozone, where growth has been flat. There are fears, currently, of an outright contraction if the European Central Bank doesn’t cut interest rates soon. The situation hasn’t been a whole lot better in China. Last year, the world’s second- largest economy grew at its weakest pace in decades, bogged down by high youth unemployment and a floundering property sector. (First-quarter GDP figures suggest a recovery might have begun earlier this year.)