Economic Outlook: A Complex and Uneven Scenario for Global Supply Chains

This is an excerpt of the original article. It was written for the December 2017 edition of Supply Chain Management Review. The full article is available to current subscribers.

December 2017

It’s December and time once again for our annual Executive Guide to Supply Chain Resources. This is a comprehensive guide to services, products and educational opportunities targeted specifically to supply chain professionals. As with years past, we’re also featuring several articles we trust will offer food for thought in your supply chain throughout the coming year.

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The global upswing in economic activity is strengthening, say analysts for the International Monetary Fund. In their World Economic Outlook (WEO) forecast, they note that broad-based upward revisions in the euro area, Japan, emerging Asia, emerging Europe and Russia—where growth outcomes in the first half of 2017 were better than expected—more than offset downward revisions for the United States and the United Kingdom.

But the recovery is not complete, says Sebastian Acevedo, a WEO contributor. He notes in the report that while the baseline outlook is strengthening, growth remains weak in many countries, and inflation is below target in most advanced economies.

“Commodity exporters, especially of fuel, are particularly hard hit as their adjustment to a sharp step down in foreign earnings continues,” he says. “And while short-term risks are broadly balanced, medium-term risks are still tilted to the downside.”

The welcome cyclical pickup in global activity thereby provides an ideal window of opportunity to tackle the key policy challenges—namely to boost potential output while ensuring its benefits are broadly shared, and to build resilience against down-side risks. A renewed multilateral effort is also needed to tackle the common challenges of an integrated global economy.

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