Modest growth in global economy in 2016

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Trade in Cambodia's ports. Photo: World Bank/Chhor Sokunthea

The world economy can expect only "modest improvement" over the next two years, according to a United Nations report launched on Thursday.

The World Economic Situation and Prospects (WESP) report predicts growth will reach 2.9 per cent in 2016 and 3.2 the following year.

It calls for stronger and more coordinated policies to achieve inclusive and sustainable growth.

Dianne Penn reports.

The report reveals how a sharp drop in commodity prices, large capital outflows and increased volatility in financial markets have had an impact on developing and transitioning economies.

As a result, growth has slowed to its weakest pace since the 2008 global financial crisis.

Lenni Montiel is Assistant Secretary-General in the UN Department of Economic and Social Affairs, which published the report.

"Weak global growth continues to hurt labour markets.  Unemployment is on the rise in some regions, or remains stubbornly high in some countries. At the same time, job insecurity is becoming more entrenched amid a shift from salaried work to self-employment."

The report warns that the slowdown could impact poverty reduction efforts in developing countries.

It calls for stronger and more coordinated policies to turn the situation around and ensure inclusive and sustainable growth.

Examples include investments that address inequalities in education and health, or through providing stronger social safety nets.

Dianne Penn, United Nations.

Duration: 1:13

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