As the United Nations Conference on Trade and Development (Unctad) celebrated its 50th anniversary, the body called for greater international policy coordination in its 2014 annual report, released in September. The publication warned governments against complacency, particularly as tepid growth rates have become "the new normal". 

Global economic growth is projected to increase slightly in 2014, to 3% from 2.3% in 2012 and 2013, but will remain “significantly below its pre-crisis highs", warned Unctad. In Europe, an easing of fiscal austerity and loose monetary policy should bring a slight uptick in developed country growth to 1.8%, driven by Germany and the UK. Developing countries are expected to maintain a growth rate of between 4.5% and 5%, resulting in a moderate improvement in global economic expansion. Asia is expected to remain the region with the highest growth rate, with China’s estimated 7.5% economic growth leading the region in 2014. 

Advertisement

Despite “anaemic” growth rates, as the authors of the report put it, in developed economies, fiscal austerity coupled with expansionary monetary policy had led in most cases to weakened domestic demand alongside higher asset values and large capital outflows. Emerging economies are therefore vulnerable to negative shocks given the “persistent weakness in the international financial architecture". The report added that allowing for greater fiscal and policymaking flexibility in developing countries will lead to a more “inclusive and sustainable” trade and development agenda in the current global economic context.

Unctad's report concluded with a cautionary note against curtailing policy maneuverability with a “one-size-fits-all” approach from the international institutions originally created to promote a balanced and “inclusive” outcome, and proposed to work towards the goal of “prosperity for all".