About
- The report is released by London based multinational professional service network PricewaterhouseCoopers (PwC). The report is a short publication that looks at the 'trends and issues’ affecting global economy and details of its latest projections for the world’s leading economies.
Key Findings
- The report notes that the global economy is expected to slow in 2019 as G7 countries return to long-range average growth rate after a mini-boom witnessed between the end of 2016 and early 2018.
- PwC expects that the pickup growth of most major economies seen between the end of 2016 and beginning of 2018 is now over.
- The UK and France have regularly alternated in having the larger economy, but subdued growth in the UK in 2018 and again in 2019 is likely to tip the balance in France’s favour.
- It also notes that workers and wages will come to fore and trade conflicts will deepen.
- The main focus of the tensions is likely to remain US-China trade conflict, but there will always be the risk of this escalating into wider trade conflict and businesses accordingly need to plan for different scenarios.
- India and France are likely to surpass the UK as the World’s largest economy rankings in the year 2019, knocking it from fifth to seventh place in the global trade.
- As per the World Bank data, in 2017, India became the sixth largest economy with a GDP of USD 2.59 trillion, relegating France to the seventh position whose GDP stood at USD 2.58 trillion.
India Specific Finding
- India is likely to surpass UK as the World’s largest economy in 2019.
- It mentions that India is the fastest growing large economy in the world, with an enormous population, favourable demographics and high catch-up potential due to low initial GDP per head.
- While the UK and France have regularly switched places owing to similar levels of development and roughly equal populations, India’s climb up in the rankings is likely to be permanent.
- The report projects real GDP growth of 1.6% for the UK, 1.7 % for France and 7.6% for India in 2019.
- The report suggests that India should return to a healthy growth rate of 7.6% in 2019-20 if there are no major headwinds in the global economy such as trade tensions or supply-side shocks in oil.
- Growth will be supported through further realisation of efficiency gains from the newly adopted GST and policy impetus expected in first year of new government.
