TAIPEI (Taiwan News) - While 2018 was the year that saw the trade war break out between the United States and China, 2019 will be the year when the world feels the pain, Bloomberg reported Wednesday.
Three risks in particular stand out as threats to the world economy for the coming year, according to Tom Orlik of Bloomberg Economics. The 90-day truce between Washington and Beijing might fail to result in an agreement and lead to renewed confrontation, while companies might have exported as much as possible in 2018 to avoid more new tariffs, and a softening of demand is likely even after the trade war.
The International Monetary Fund sees trade volumes slowing down from 5.2 percent in 2017 to 4.2 percent this year and to 4 percent in 2019, with trade barriers more pronounced, Bloomberg reported.
If the U.S. and China do succeed in reaching an accord by the March 1 end of the trade war truce, the world economy might gain a new impetus, but at present, uncertainty lingers, which makes corporations unlikely to approve new expansion plans, said Bloomberg.