Losing To Win

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THE overall global economy is gradually moving ahead with steady growth forecasts. Growth in major industrial economies witnessed a recovery with their GDP growth rates expected to remain strong in 2018 and 2019. The US’s GDP growth is forecasted at 2.3% in 2019, slightly modera­ ting thereafter. GDP in developing Asia has seen strong expansion to around 6% plus, due to both domestic and external demand. The EU region may slow down in the coming years. Growth in China, which accelerated on account of robust consump­tion and still rising exports, is likely to moderate to 6.6% in 2018. In India, growth is emerging from the recent slowdown in 2017 to 7.3% in FY 19, further rising to 7.6% in FY 20. However, a fall in central government’s capital expenditure in FY 18 and fall in investment poses a challenge for future growth.

Globally, central banks are realigning from an accommodative stance to normalising their monetary policies for tackling growth and inflationary risks as investment levels take off. However, they continue to remain alert as the ever-changing global dynamics and political and social compulsions across the world impact trade and investments. The recent crude price spike, geopolitical developments and heightened global trade tensions will alter the global economic indicators such as trade and current account deficits, fiscal deficit, inflation, exchange rates, etc. Different regions and nations will be differently impacted. As global and local opportunities and challenges become intertwined, companies will need to be agile, and continuously review their strategies and business models in order to remain competitive and leverage the disruption to their advantage.