After the UK’s vote to leave the European Union, risks to the world economy have heightened, according to the global finance chiefs at the end of the G20 summit in China.
The outcome of last month’s EU referendum ‘adds to the uncertainty’ for the global economy, the group of the world’s 20 largest economies further said.
“In the future, we hope to see the UK as a close partner of the EU,” the G20 collectively said.
The UK Chancellor of the Exchequer Philip Hammond revealed the subject had come up ‘a great deal’ at the two-day talks.
“The reality is there will be a measure of uncertainty continuing right up to the conclusion of our negotiations with the EU,” Philip Hammond told reporters.
Following the meeting in the Chinese city of Chengdu, the G20 group said it was well placed to actively cope with the potential economic and financial impact from the Brexit vote.
However, despite the threats the G20 agreed that despite the Brexit vote, the global economy ‘would improve in 2016 and 2017’, Mr Weidmann (the president of Germany’s central bank) said.
Separately, G20 policymakers said they recognised that excess steel supply was a global issue.
The excess capacity of steel has had a negative impact on trade and workers and requires a collective response, they said.
It was also announced that Britain’s decision to leave the EU has led to a ‘dramatic deterioration’ in economic activity, not seen since the aftermath of the financial crisis.
Data from IHS Markit’s Purchasing Managers’ Index, or PMI, shows a fall to 47.7 in July, the lowest level since April in 2009. A reading below 50 indicates contraction.
What do you make of these announcements by the G20?
Has the Brexit warnings by the Stronger In campaigners become a fact? Will the economy suffer heavily from a brexit? If so, will it be able to grow again by 2017?
Comment below your views on Brexit’s outcomes and a potential global economy suffering the G20 have announced as a result of brexit