Sting in the tail of latest upbeat economic prognoses

THE latest report card on global economic health makes for some welcome heartening reading - according to the International Monetary Fund (IMF), the upswing in economic activity around the world is strengthening, with signs that 2017 will be the best year for global growth since 2010.

But there is, of course, a sting in the tail in the positive prognosis: despite a notable pick-up in investment, trade and industrial production as well as rising confidence, the global recovery is far from complete - and indeed could be derailed altogether, given still low, below-target inflation in most advanced countries, as well as weak below-potential growth in many economies, and not least, geopolitical risks.

The medium-term risks are still decidedly on the downside. Still, with global growth projected to rise to 3.6 per cent in 2017 and 3.7 per cent in 2018 - a slight uptick from forecasts of six months earlier - for both governments and businesses around the world, it is undoubtedly fairer skies and a better external climate than they have had for some time. And as IMF managing director Christine Lagarde has put it pithily, a good recovery should not be wasted. For policymakers, the welcome cyclical pick-up in global activity provides an ideal window of opportunity to tackle key challenges, the IMF has urged - namely to boost potential output while ensuring that its benefits are broadly shared, and to build resilience against downside risks.