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G20: Brexit adding uncertainty to slowing global economy

Central bank chiefs and finance ministers from the world's top 20 economies are gathered in the southwestern Chinese city of Chengdu. Photograph: (Getty)

AFP Chengdu, China Jul 24, 2016, 07.41 AM (IST)
Britain's vote to leave the European Union heightened risks for the world economy, finance chiefs from the G20 group of leading countries said on Sunday at a meeting in China.

The outcome of last month's referendum "adds to the uncertainty in the global economy", said China's finance minister Lou Jiwei, who hosted the meeting.

But he added that EU member countries were "well positioned to proactively address the potential economic and financial consequences stemming from the UK referendum".

The International Monetary Fund (IMF) has warned risks to the global economy are growing, as it called on some G20 nations to boost government spending.

Central bank chiefs and finance ministers from the world's top 20 economies gathered in the southwestern Chinese city of Chengdu on Saturday to tackle a slowing global economy facing new uncertainties with Britain voting to leave the European Union (EU).

"Global growth remains weak, and downside risks have become more salient," the IMF said in a report released ahead of the G20 meeting.

"Growth could be even lower if the current increases in economic and political uncertainty in the wake of the 'Brexit' vote continue."

The IMF wants advanced economies like Germany and the United States to channel more public spending into infrastructure investment to help boost global growth, an issue that has sparked divisions among G20 members.

"Reforms that facilitate the scaling up of infrastructure investment would help raise productive capacity, boost short-term demand directly, and catalyse private investment," it said.

(AFP)

 
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