The Organization, in its report “OECD Economic Outlook, March 2023 Interim Report”, estimated a global growth of 2.6%, but for Argentina it lowers its projections to 0.1% unlike what is expected for China, which expects growth of 5.3%.
It should be remembered that in this sense, President Alberto Fernández in February, during an act, affirmed that Argentina has only been surpassed by China. In the report for 2024, growth of 1.8% is forecast for Argentina.
The OECD report finds that Argentina is overtaken by: Germany, South Africa, Italy, France, Brazil, Korea, Mexico and Indonesiajust to name a few.
Worldwide the economy slowed during 2022, being one percentage point lower than the expectations that had been projected into 2021.
Lowering food prices is essential, gave confidence at the beginning of 2023, as prices had reached unexpected values at the beginning of the war. This slight decline predicts a higher purchasing power of households.
The OECD is optimistic about the reopening of Chinabecause this will have a global impact on the supply chain and on international tourism.
On the other hand, reduction of energy costs, as a result of a warm winter, stimulates business growth. These factors help to reduce global inflation.
It should be remembered that a week ago the French president, in an attempt to stop the escalation of price increases, adopted the “anti-inflation quarter” plan due to the inflationary spiral. This situation positions France, according to the Organization, with a growth projection of 0.7% for 2023.
In general, inflation in most countries is starting to slow down. During the pandemic, consumption decreased drastically, today it can be said that the world is gradually recovering pre-pandemic consumption levels.
As regards core inflation, the inertia generated by the increase in the prices of services and labor market costs continues.
The crisis that the financial system is experiencing has also been the subject of debate. At a press conference in Paris, Alvaro Pereira, acting chief economist of the OECD said the world economy is not experiencing a ‘systemic crisis’, he in turn stated that “We are in a very different situation than in 2008.”
“We have created stronger regulation, central banks and regulators have also learned from past crises” and underlined that “most of the world’s banks are very well capitalised”.
Economist Iván Carrino, head of Iván Carrino y Asociados, FCE-UBA adjunct professor and Universidad del Desarrollo in Chile, in dialogue with Clarín said: “Inflation remains too high globally to ease monetary policy.”
And he added that: “when you try to stabilize inflation, there are risks like what you are seeing in the banking system. But trying to bail out all depositors can be a powerful fuel for inflation in these contexts. If the problems in the financial sector do not improve, we will all be faced with poor public policy choices,” she concluded.
Fernando J. Genazzini
Source: Clarin
