The United States calls on major countries to act to stimulate the global economy

The United States calls on major countries to act to stimulate the global economy



19-10-2019 08:49 AM

Baghdad / News

Washington has called on other major powers in the world to work to stimulate economic growth, without mentioning the US-China trade war, blaming increased state savings for the current global slowdown, weakening investments in China and Europe.

In a statement released at the end of the annual meetings of the World Bank and the International Monetary Fund, US Treasury Secretary Stephen Mnuchin said that "the US economy is advancing on the international stage and is expected to achieve faster growth thanks to tax cuts and reforms by President Donald Trump."

Mnuchin's comments contradict previous IMF warnings this week that the US-China trade war would cost the world economy only 0.8 percent next year alone and also affect US business investment.

While the IMF called for more stimulus for the economy, it lowered its global economic outlook for the fourth quarter, citing Trump's trade wars as a major cause of weakness.

"If the countries of the world do not take action, the slowdown in China, Germany and Europe could be longer or deeper than originally envisaged," Mnuchin said.

"There is plenty of room for tax cuts and other fiscal measures" to stimulate a recovery in economic activity, he said.

"In addition, weak demand and low interest rates are symptomatic of a significant increase in savings that are not productively employed in the local economies of China, Germany, the Netherlands and other major economies," Mnuchin added.

China's gross domestic product fell to 6 percent in the last quarter, its lowest level in 27 years.

While the United States has outperformed other industrial economies this year, there is growing evidence that Trump's trade wars have hurt US industries and the agricultural sector in particular because of poor exports.

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