OECD Sees Stronger World Economy, But Risks Loom Large

OECD ups GDP growth forecast for Poland

OECD ups GDP growth forecast for Poland

"Accelerating wages will underpin rising inflationary pressures".

The Organization for Economic Cooperation and Development (OECD) foresees stronger growth for the Greek economy over the next two years, while there will be significant reduction of the unemployment and increase in exports and investment.

The prospect of a trade war is threatening the global growth outlook, which otherwise is on course for a 40-year low in unemployment, the OECD said on Wednesday.

The organisation forecast government gross debt would fall to 35.7 percent and 35.6 percent of GDP in 2018 and 2019 respectively, from 36 percent in 2017.

Economists are expecting a solid result for the first three months of the year, with a quarterly pace of growth at around 0.8 per cent, double the outcome of the December quarter.

Largely due to a substantial fiscal boost, the United States will expand 2.9 percent in 2018 and 2.8 percent next year, the agency said.

Nevertheless, oil prices, which have risen sharply in recent months, and worldwide trade, facing threats of higher barriers, pose risks to the outlook, the OECD reported.

Germany's GDP growth is forecast to be 2.1 percent each in 2018 and 2019, while France's growth is seen at 1.9 percent for both this year and next.

Outside of the OECD, Chinese growth was expected to ease gradually from 6.7 per cent this year to 6.4 per cent in 2019 as infrastructure investment slows in the face of tighter lending conditions and tougher government project approvals.

Upside risks to growth include faster export growth if the recovery in export markets is stronger than projected or if more intense privatisation releases resources to more dynamic exporting firms, according to OECD.

The outlook highlights a range of risks to the current expansion. It urges countries to boost investment in education and skills, as part of improvements in the use of tax and spending policies to raise living standards across the income distribution.

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