The International Monetary Fund, in its flagship report on the state of the global economy, nudged up its forecast for world growth this year a tenth of a percentage point to 3.5%, which will be the fastest rate in five years if the IMF is correct.
In its World Economic Outlook, published on Tuesday, the Fund argued that growth in Greece this year will come to 2.2 percent against a forecast of 2.8 percent last October, but this will not put the sustainability of the country's debt at risk.
"The expected growth improvements in 2017 and 2018 are broadly based", said Maurice Obstfeld, IMF's head of research, but he added that "growth remains tepid in many advanced economies, and commodity exporters continue to struggle".
"At the same time, a combination of adverse weather conditions and civil unrest threaten several low-income countries with mass starvation".
However, Obstfeld said the global economy seems to be gaining momentum.
Both the Reserve Bank of India (RBI) and the International Monetary Fund have earlier lowered India's growth estimates for the previous fiscal by up to 1 per cent, citing the impact of demonetisation. Also forecast to contract is Kuwait - by 0.2 per cent, compared with a previous forecast of 2.6 per cent growth. The projection for next year was left unchanged at 3.6%.More news: Georgia Driver Demetrius Hollins Had Earlier 'Encounter' With Fired Cop
The IMF said the upward growth revision "reflected stronger-than-expected momentum in 2016 and the anticipation of continued policy support in the form of strong credit growth and reliance on public investment to achieve growth targets". "But even as things look up, the post?World War II system of worldwide economic relations is under severe strain despite the aggregate benefits it has delivered - and precisely because growth and the resulting economic adjustments have too often entailed unequal rewards and costs within countries", he said.
"Protectionist policies in advanced economies would have an overall negative impact in Asia, including the Philippines, but the magnitude of impact and channels would depend on the specific policies that are still uncertain", Peiris said. Consumer confidence isn't just strong in the U.S.: It also ticked higher in March in the eurozone, underpinned by a eurozone unemployment rate that in February hit its lowest level since mid-2009. These could in turn spill over to other countries.
It said that growth is likely to dip in most Gulf Cooperation Council member states, which also include Bahrain, Kuwait, Oman, Qatar and the United Arab Emirates.
But the IMF, Germany and other nations are anxious that overly-aggressive actions by the US could spark a tit-for-tat trade war that stalls global growth. Projected global growth is set to rise to 3.5% from 3.1%.
Among the factors that could harm economic growth: a protectionist trade agenda, a faster-than-expected rate hike in the US, and an aggressive rollback of financial regulations, according to the IMF's report.