World economic growth has weakened substantially this year and faces the confluence of a triple threat — the fiscal cliff in the United States, a worsening European debt crisis and a sharp slowdown in China, the United Nations said in a year-end report released on Tuesday. The worst case, the report said, could be a new global recession that mires many countries in a cycle of austerity and unemployment for years.
The principal author of the report, Robert Vos, director of the Development Policy and Analysis Division of the United Nations Department of Economic and Social Affairs, said the trends meant it could take until at least 2017 just to recoup the jobs lost in the United States and Europe since the 2008-2009 global recession.
He forecast the pace of world growth for 2013 at 2.4 percent, “a significant downgrade” from the United Nations midyear forecast of 3.1 percent. He said the 2012 growth rate was 2.2 percent, weaker than the midyear forecast of 2.5 percent.
“I’m afraid this time around we’re not very optimistic about how things are moving,” Mr. Vos told a news conference at the United Nations headquarters.
“A worsening of the euro area crisis, the ‘fiscal cliff’ in the United States and a hard landing in China could cause a new global recession,” Mr. Vos said in the report, titled “World Economic Situation and Prospects 2013.” He said the forecast pace of growth “will be far from sufficient to overcome the continued jobs crisis that many countries are still facing.”
Choosen excerpts by Job Market Monitor from