While global economic growth remains slow, Afriforesight’s head of research, Vinesh Chetty, said the firm’s research indicates there is no global recession and full-year growth is likely to be positive.
Speaking at a webinar hosted by AfriForesight on July 10 titled “Cobalt and Copper: Opportunities for Africa”, Chetty explained that the slowdown in growth could be attributed to waves of inflation, adding that high interest rates often put further downward pressure on the global economy.
He said economic growth has been weak this year but is still growing, driven mainly by the United States and China.
He added that de-globalisation has also led to slower growth, citing the example of the US attempting to impose tariffs on Chinese products, saying trade barriers have created friction and inefficiencies in the global economy, which in turn has led to slower growth.
But he noted that the European Central Bank’s recent interest rate cuts have lowered interest rates and accelerated economic growth, and the U.S. Federal Reserve is expected to follow suit.
However, Chetty argued that trade barriers could also create opportunities for countries not affected by the tariffs.
For example, while American consumers paid higher prices for imports from China, countries such as India, Vietnam and Mexico had the opportunity to increase their exports to the United States.
“A global delink will slow things down, but it will also create opportunities for countries to expand production.”
Meanwhile, Chetty noted that global economic growth is also being driven by increased investment in green technology, leading to increased demand for metals such as copper and cobalt.
He explained that copper is linked to many different sectors of the global economy, so when the global economy is doing well, copper also does well.
