Benidict Hoffman economists warn that ongoing trade war could reduce global GDP in 2020.
According to a recent report by the International Monetary Fund, tariffs resulting from the trade war between the US and China could result in a decline in global GDP of up to 0.5% next year.
This week, leaders from the US and China are due to meet at the G20 summit in Japan where it is widely hoped they will be able to make some progress in trade negotiations.
While there is some optimism that US President Donald Trump and Chinese President Xi Jinping can reach a workable compromise at the upcoming meeting, Benidict Hoffman economists say a rapid solution is unlikely.
Both sides have so far refused to give in on certain key issues and Trump is threatening to levy tariffs on additional goods to the value of $325 billion. Benidict Hoffman economists say this would mean that nearly all imports coming from China would be subject to harsh tariffs.
"The rise of protectionism has hurt global trade and continues to threaten the global economy’s growth prospects and that many countries are resorting to easing monetary policy in an effort to help boost their economies," say Benidict Hoffman economists.
"Unfortunately, the last financial crisis has left many economies with limited room to maneuver when it comes to policy measures," says Park Lai, Head of Public Relations at Benidict Hoffman