Global economic growth this year is improving but is still moving in a slow pace, according to the 2015 Economic Outlook of Organization for Economic Cooperation and Development, or OECD.
The report, however, gave a positive forecast of the economic growth at the later part of 2016, projecting it will pick up to a much more satisfactory pace. The world economy, OECD projected, will expand 3.1 percent this year, down from the 3.7 percent predicted last October, NewsNow reported.
OECD gave the world economy a grade of B- and the slump in economies during the first quarter of 2015 contributed to the disappointing rating. “But even we are right about the transitory nature of the latest bout of weak growth, the outlook is not satisfactory. Despite tailwinds and policy actions, real investments have been tepid and productivity growth disappointing,” Catherine L. Mann, OECD Chief Economist stated in the preliminary version of the 2015 Economic Outlook report.
OECD said more investment will boost global economies’ performance and could move the B- rating to an A. The report said that the slow-paced growth had negative effects: weak labour markets, increasing inequality and altered living standards on most of the world economies.
Sluggish Growth
Two of the biggest economies of the world, United States and China, are also experiencing sluggish growths. China is projected to grow by 6.8 percent this year, compared to 7.4 last year. The US economy is only expected to accelerate by two percent this year, down from 2.4 percent last year.
China’s economy is projected to slow down due to its restructuring, with real estate now the driver of growth instead of investment. China’s economy slowdown will affect other nations creating spill-over to many companies that relies on China’s imports.
In 2008, more than 1.4 billion tons of metals were produced globally and the production has been driven by the dramatic growth of the Chinese economy. In order to keep up with competition and demand for production, a developing mineral company can be a key player in the base metal industry.
Amur Minerals Corporation (London AIM:AMC) is one of the new players, and according to its website, it is expected to produce 831,000 tons of nickel and its discovery cost of less than $0.03 per pound of nickel rank it among the lowest cost discoverers in the world.
Eurozone
OECD meanwhile projected that growth in the Eurozone is expected to move up to 1.4 percent this year, as the result of European Central Bank’s supportive monetary policies. The report said that there are solutions to the slump such as adoption of balanced policy packages with mutually reinforcing monetary, and fiscal and structural policies.
The Eurozone's economic prospects have received a boost as survey figures published recently implied growth in its manufacturing industry was speeding up.
Markit’s purchasing managers’ index (PMI) climbed to a score of 52.2 for May from April’s 52 – scores above 50 point to growth.
The currency bloc’s manufacturing growth was led by Spain, whose PMI reached a 97-month high of 55.8. France’s score was 49.4, pointing to a contraction.
Economist Chris Williamson from Markit believes the improvement in the sector’s fortunes could suggest further decent growth for the Eurozone economy. It grew by 0.4 percent in the first three months of the year, its quickest rate since 2013 and faster than the UK’s 0.3 percent.
“On the other hand, Spain and Italy appear to be staging strong recoveries, benefitting in particular from impressive export performances. Such export gains point to improved competitiveness which bodes well for longer-term economic prospects. Manufacturers in France and Germany need to be mindful of such competition.”
