Global recession warning: Eurozone on alert as economist predicts HUGE crash
THE global economy is heading for a recession late this year or next, a Nobel Prize-winning economist has warned.
By TOM NELLIST
Express.co.uk
Mon, Feb 11, 2019
Professor Paul Krugman has warned a series of isolated downward economic trends around the world will spiral into an unavoidable global recession towards the end of 2019 or the beginning of next year. Mr Krugman said there is not “one big thing” prompting the stark forecast but instead blamed a number of incidents happening at the same time. He said a slump in the eurozone combined with the long-running US-China trade war, President Trump’s tax policy and world leaders’ lack of preparedness are increasing the risks of a worldwide economic slowdown.
Mr Krugman’s warning comes despite policymakers expressing hope growth will pick up before an outright recession hits.
Nevertheless, most economists and many of the world’s top business leaders are preparing for the worst.
Speaking at the World Government Summit in Dubai, Mr Krugman said: “I think that there is a quite good chance that we will have a recession late this year or next year.”
He added the tech growth which has been expanding for decades is “starting to look like the bubble may be deflating”.
Mr Krugman also pointed to the euro as a stumbling block.
He said: “The place that looks really close to recession right now is the euro area.”
Last week the European Commission significantly downgraded its economic growth forecast for 2019.
Brussels said it expects to see a slow to 1.3 percent, down from 1.9 percent last year.
Mr Krugman also blamed world leaders for not making enough preparations for a snap economic downtown.
He said: “The main concern has always been that we don’t have an effective response if stuff slows down.”
The news came as UK growth was revealed to have limped along at just 0.2 percent in the last quarter of 2018.
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