According to the World Bank’s Global Economic Outlook ( June 2019), global growth in 2019 has continued to weaken and is expected to slowly rise to 2.8% in 2021 from 2.6% in 2019 (Table 1). Global growth prospect is impacted by prevailing factors such as softened investment in emerging market and developing economies (EMDEs), possible escalation of trade tensions, and rising debt levels. In addition, the United Nation’s Conference on Trade and Development’s (UNCTAD) Trade and Development Report 2019 also indicate clear signs of recession in 2020.
The focus of the global economy is largely on the US-China trade war, and Malaysia (and Penang) as an open, trade-oriented economy is impacted by the developments of this trade war. It is hoped that the Phase 1 deal negotiated by the US and China will provide some relief to the trade war which has now gone on for almost two years.
