World economy buckles beneath U.S. financial crisis

    OTTAWA, Oct. 24 /CNW Telbec/ - Buckling under the weight of the worst
financial crisis to affect the U.S. economy in the last half-century, global
economic growth is forecast to slip to 2.8 per cent in 2008 and 2.4 per cent
in 2009, according to the Conference Board's World Outlook - Autumn 2008.
    "A number of developed countries are close to recession, and given the
current state of financial markets, weak economic growth is expected to last
through 2009," said Kip Beckman, Principal Research Associate. "Developing
countries such as China and India have picked up the slack in the world
economy, although they too are now being affected by the global slowdown."
    Strong exports enabled the U.S. economy to avoid a technical recession
over the first two quarters of 2008, but the slump in consumer spending is
pushing the United States into recession. This outlook calls for real GDP
growth of 1.8 per cent this year and 0.5 per cent in 2009.
    With GDP growth stalled in the United Kingdom, Germany, and France, the
economic outlook for Europe is pessimistic. Japan is likely to slip into
recession, but most other Asia-Pacific economies are expected to avoid
recessions. Even China's economy has lost momentum lately, due to a slowdown
in export growth. After growing by 12 per cent in 2007, real GDP growth will
slip into single digits in both 2008 and 2009. The view that most economies in
the region could "decouple" from the U.S. economy-therefore continuing to
expand at a brisk pace-has been challenged.
    The turmoil in the United States is limiting Canadian economic growth to
0.8 per cent in 2008, but the Conference Board's current projection is that
Canada will skirt a recession.

For further information:

For further information: Brent Dowdall, Media Relations, (613) 526-3090
ext. 448,

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