Though braced by a resurgent United States, the global economy is under threat from other regions from Europe and Latin America to China and Japan where growth is stalling and prospects remain dim.
That's the bleak picture facing global finance officials who are meeting this week in Washington to consider policies to address the world's uneven growth. Their meetings follow downbeat assessments of the global economy issued this week by the International Monetary Fund, the Brookings Institution and the Federal Reserve.
The talks are beginning today with finance ministers and central bank presidents of the Group of 20 nations, which includes traditional powers such as the United States, Japan and Germany and emerging economies such as Russia, China and India. Next will come meetings of the 188-nation International Monetary Fund and its sister lending organisation, the World Bank.
In a global forecast prepared for the meetings, the IMF downgraded its outlook this year because Europe is at risk of slipping back into recession and persistent weakness is slowing Japan, China and Brazil. The IMF called the recovery uneven and said global growth this year would be 3.3 percent, one-tenth of a percentage point below its forecast in July. And it lowered its outlook for 2015.
Brookings' report spoke of the United States as "the sole major economy still showing signs of strength."
"The world still seems to be counting on riding the coattails of the US economy," said Eswar Prasad, a Cornell University economist who was among the authors of the report. "That is not going to produce a sustainable recovery."
Fed officials took note of the weakness in overseas economies and the strengthening dollar at their September meeting, according to minutes released yesterday. The minutes indicated that officials worried that sluggish economies in Europe, Japan and China could depress US exports.
Concerns about Germany's economy Europe's largest have been mounting. The most recent figures show that industrial production, exports, factory orders and business confidence have all endured sharp declines.
Collectively, the figures raised the risk that Germany could slide into recession. The country is suffering from weak demand for its goods from the rest of Europe and China and from fears about the effect of sanctions imposed on Russia over the crisis in Ukraine.
