Global economic prospects in 2016 are better than plunging stock markets - triggered by fears surrounding China's economic slowdown and sharply lower oil prices - are indicating, experts at the World Economic Forum said here Saturday.
Risks do exist, however, due to China's profound economic changes, the possibility that commodity prices will fall further - affecting exporting countries and their ability to repay their dollar-denominated debt - and a lack of monetary policy coordination.
The Chinese government is continuing to transition from a heavy industry-based to a service-based economy while also making domestic consumption its growth engine as opposed to relying on exports and investment, International Monetary Fund Managing Director Christine Lagarde noted, adding that even with these enormous challenges the Asian giant grew 6.8 percent in 2015.
Credit Suisse CEO Tidjane Thiam said for his part at end of the five-day forum that his bank was forecasting a "soft landing" for the Chinese economy, adding that that country's growth "doesn't worry us."
He said low crude prices were not due to a lack of demand but to a supply glut and stressing that they were "good for the global economy," citing the benefits for U.S. and European consumption and for 5 billion people in "countries that are net importers." EFE