Slow growth expected
Global recovery remains a long way off, experts say
WASHINGTON – A robust recovery for the global economy remains well out of reach.
That’s the view that emerges from a survey of economists just as the Federal Reserve is expected this week to reduce its stimulus for the U.S. economy.
Europe has finally emerged from recession. Japan is growing after two decades of stagnation. And the United States is trudging ahead. Yet an Associated Press survey of more than two dozen economists suggests that global growth will remain below full health this year and next.
Persistently weak growth would make it harder to resolve many of the world’s biggest economic challenges. They include historically high unemployment in Europe, sluggish spending by consumers and businesses in the United States, heavy government debts in Europe and Japan, and unstable economies in some emerging nations.
The economists think the 17 nations that use the euro will grow at an annual rate barely above 1 percent in the second half of 2013 and in 2014. From April through June, the eurozone eked out its first quarterly growth after 18 months of contraction – a 1.2 percent annual rate. No acceleration is foreseen in the next year and a half.
The United States and Japan are expected to fare only slightly better.
The economists think the U.S. economy will grow at a 2.3 percent annual rate in the second half of 2013 and 2.6 percent in 2014. Japan is expected to grow 2.2 percent next year – far weaker than its 3.8 percent growth rate from April through June.
Normally, a healthy expansion in advanced economies produces annual growth of 3 percent or better. The United States expanded at an average pace of 3.25 percent from 1976 through 2007. But it hasn’t grown at a 3 percent rate or faster since 2005.
“Most economies are growing so slowly… you don’t know one day from the next if it’s getting better or getting worse,” said Susan Sterne, an economist at Economic Analysis Associates.
The economists’ dim outlook for the recovery in many advanced economies coincides with a slowdown in some key emerging economies after years of powerful growth.
China’s growth, for example, slowed in the second quarter to 7.5 percent – explosive by the standards of developed countries but the slowest pace for China in two decades.
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