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● Mexico Crisis, Korea Recession.

Latest OECD Economic Outlook Analysis – Checking Global Economy, Global Trends, Economic Outlook, Trade War, and Growth Rate

1. OECD Report Release and Overview of Key Contents

The OECD Economic Outlook report was released on March 17th at 7 AM Korean time.

Started data analysis immediately by updating the PowerPoint.

The report’s subtitle, “STE th unc,” metaphorically expresses uncertainty and risk factors.

Particularly noteworthy are the warnings about the Mexico crisis and the downward adjustment of Korea’s growth rate.

2. Global Economy Overview – Entrenched Low Growth and Economic Cycle

The global economic growth forecast has been slightly lowered from the previous 3.3~3.1%.

The IMF, OECD, and World Bank all commonly forecast a decline from the 3.6% average growth rate.

It is interpreted as entrenched low growth rather than an economic crisis, a downturn within the economic recession cycle.

This trend is a key variable affecting the overall global economy.

3. U.S. Economy – Solid Expansion Phase

The U.S. grew by 2.9~2.8% in 23~24 years.

A 2.2% growth is expected in 25 years, but with a potential growth rate similar to 2.0%, concerns about a recession are low.

The solid expansion is evaluated with the expression ‘Lost 션, Lost Expansion’.

Positive factors such as adjusting factory operating rates and attracting skilled talents are at play despite the trade war.

4. Chinese Economy – Countervailing Effect with Economic Stimulus Package

China is expected to have a countervailing effect through the strong economic stimulus package of the Xi Jinping government, even amid the pressure of the U.S.-China hegemonic war.

It plays a stable role in the global economy, accounting for about 25% and 15~17% of GDP along with the U.S.

Despite trade and diplomatic risks, it is checking downward pressure through win-win policies.

5. Growth Rate Adjustment by Major Countries – Mexico, Canada, Europe, Korea

Mexico: Downward adjustment of 2.5% points, with an extreme adjustment situation with a -1.3% growth forecast in 25 years.

Canada: Dropped from the previous 2.0% forecast to 0.7%, a 1.3% point adjustment.

Europe: The Eurozone is -0.3%, and Germany, France, Italy, and the UK are also slightly downward adjusted.

Korea: Downward adjusted by 0.6% points from the existing 2.1% forecast to 1.5%.

Differences by country are interpreted as the impact of economic size, domestic demand, and trade uncertainty.

6. Trade War and Geopolitical Risks – Warning about Economic Transmission

The trade war between the U.S. and China, and the adjustments in neighboring countries such as Mexico and Canada, raise concerns about economic transmission.

In particular, Mexico’s economic crisis poses a risk of spillover to neighboring countries and the world economy, like the Tequila effect.

If geopolitical risks intensify, there is a possibility of financial instability and a transition to an economic recession.

7. Korean Economic Outlook – Impact of Domestic Demand and Diplomatic Uncertainty

The Bank of Korea’s forecast plummeted to 1.5%, with political and trade uncertainties acting as major variables.

The OECD Economic Outlook report warns that the Korean economy has entered a severe recession phase.

It is time to carefully respond to both internal economic policies and diplomatic strategies.

8. Comprehensive Analysis and Future Outlook

The solid expansion phase of major countries around the world and the rapid decline in growth rates of some countries coexist.

It is interpreted as entrenched low growth rather than an economic crisis, a downturn within the economic recession cycle.

Going forward, the response of each country’s government to overcoming the trade war, geopolitical risks, and sluggish domestic demand is key.

Economic experts expect a gradual recovery amidst the uncertain international environment and evaluate that they should focus on risk management.

Summary

The OECD Economic Outlook report was released on March 17th.

The global economy is projected to have entrenched low growth and a decline in the economic cycle.

The U.S. is expanding steadily, and China is expected to have a countervailing effect with a strong economic stimulus package.

Some countries, such as Mexico and Canada, have significantly reduced growth rates due to trade wars and diplomatic risks.

Korea also needs to adjust its growth rate due to domestic demand and political uncertainty, requiring a careful response from the government.

[Related Articles: OECD Outlook Commentary | Mexico Crisis Analysis]

*YouTube Source: [경제 읽어주는 남자(김광석TV)]

– [속보] OECD의 경제전망 보고서 즉시분석 : “맥시코 경제위기 처할것,” “한국은 심각한 경기침체 피할 수 없어” [즉시분석]