Ottawa—The economy is moving out of recession and into recovery, according to the Conference Board’s World Outlook (Autumn 2009). The resurging Asian economies—notably China and India—are kick-starting global markets.
The global economy is forecast to decline by 2.3 percent this year, but expand by 2.6 percent in 2010.
On a local level, the Canadian and US economies are both expected to grow in the second half of 2009, leading to real gross domestic product (GDP) growth of 2.9 per cent and 2.3 per cent, respectively, in 2010. Yet, the rebound in 2010 will be about half that of a normal recovery.
"The outright decline in economic growth this year is unlike anything experienced in the 1980s and 1990s recessions," said Kip Beckman, principal research associate with the Ottawa-based organization.
Looking overseas, France and Germany posted surprising increases in GDP in the second quarter, but the region will lag the rest of the world in recovery, according to the Conference Board.
The dire financial situation in Eastern Europe is expected to weaken demand for exports from Euro-zone countries. The Chinese economy is expanding again at near double-digit growth, following a brief slump earlier in the year.
India is also poised for strong growth over the near term. The Asia-Pacific region should post overall growth of 0.6 percent this year, followed by growth of five percent in 2010.
Latin American is emerging from the recession in fairly good shape, the organization reported. The region’s more heavily-regulated banks are in better shape than banks in the US and Europe. Brazil, the region’s largest economy, has also increased links with the expanding Asian economies.