G20, Real GDP YOY%
2016201720182019E2020E2021E
G20, Real GDP YOY%1.82.41.521.92.9
Argentina-3.13.9-3.5-0.42.73.2
Australia2.12.82.82.82.72.7
Brazil-2.71.41.32.52.52.2
Canada1.532.121.71.8
China6.76.86.56.266
France0.92.71.41.61.51.7
Germany1.82.61.11.61.51.4
India6.86.37.17.37.47.5
Indonesia55.15.25.15.35.6
Italy0.91.70.710.91
Japan0.92.10.90.50.7
Mexico2.11.52.52.12.12.9
Russia-0.21.51.51.61.5
Saudi Arabia2.1-1.41.62.42.12.1
South Africa0.91.611.71.91.8
South Korea2.93.12.62.62.8
Turkey3.112.93.6
United Kingdom1.91.81.51.61.5
United States1.52.22.51.91.8
[Positive] Teg: Argentina

Most sources say that the economy of Argentine is expected to accelerate in 2018 and 2019 on the grounds of the increase of consumption and investments in fixed assets. I remember that they want to raise infrastructure's investments by 20% this year. It is very nice and promising for businesses which engaged in mineral resource extraction, agricultural and chemical sector, well would be done and for the others in total. In such scenario GDP would expand minimum by 3% this year and by 4% in 2019. It is also worth to note (on my opinion this is important) that the government announce to cut the spending's on state apparatus. Nonetheless, this in total is ideal picture. To be skeptical for GDP, I guess adequate rates for 2018 and 2019 are 2% and 2.5%

[Neutral] Teg: Canada

Economic growth rate I expect to slow in the next two years as household consumption and government spending slows. Recent developments in consumption has not been transferred to the increase in wages and I think that house prices will continues to slow, no considerable job growth (if any at all). They also did not announced any substantial government investments. Thus, I project the growth of Canadian economy to ease

[Positive] Teg: Germany

In most cases (I mean when reading articles written by analysts) the outlook for German economy is promising. They are assumed to implement the policy of wages increase, infrastructure projects. These would boost an inflation (what we know is not bad but indeed positive when it is moderate). The political elite I think must reduce the power of sanction against Russia, I calculated that Germany may easy earn min. 25-30 bn euro. Of course this lies on political grounds and indeterminable in mid-term future.

[Positive] Teg: Turkey

As emerging economy Turkey offers the best investment case in terms of growth and downside risk in oil-linked shares. Due to positive dynamic in world oil prices as I estimate to be limited to 70 USD per barrel for 2018 year

[Negative] Teg: South Africa

In spite of installation of Cyril Ramaphosa as the new president and following increasing confidence from the international community and investors, I don't have positive outlook for the South African economy. Tighter fiscal policy and a rise of taxes to keep debt under control and prevent additional credit downgrades, will impede efforts to boost growth. Also structural constraints such as skills shortages and inefficient state-owned companies will continue to weaken economic activity, as well as negative external balance will affect the economic growth in the mid-term.

[Negative] Teg: Brazil

The Brazilian government one month ago announced that GDP this year (2018 will grow faster and they wait recovery from the recession for the past 10 years. This is for optimists. I do not see real activity (as you know some big steps) to resolve structural problems in economy. Look, all they wants to do is to narrow a budget deficit by curtailing the social security system. This will not help. Obviously imho.

[Negative] Teg: Italy

Italy faces significant challenges this year and the next 2019. In most sources It is cited that Italy is the potential highest risk factor for the whole Eurozone. It is suffering from high level of public debt (140% of GDP as of Jan-2018), thus banking systems of Italy needs to be largely restructured (but impossible under Eurozone rules). Due to fundamental weakness of the economy, we can not expect any improvements in Mid-term horizon. Also, Political risks add more challenges, I mean that the leader of euro-sceptic Italy's Five Star Movement might come to power in May 2018, one of their hot idea is so-called Italexit seems to be likely, I mean the political actions about it, practically not (at the earliest in 2022). Also, as matter of fact at founding of Party in 2009 the party was anti-Vladimir Putin, but it has since become much more pro-Russia. More likely that after election the political process of independence and pro-Russia will be the same as in Greece. Over

[Positive] Teg: Saudi Arabia

The economy of Saudi Arabia is primary linked to oil price. For the next 2-3 years most analyst bet on steady growth in oil price, thus, It is likely to forecast economic growth. You know, that the government recently announced that it expects 2.7% GDP real growth rate. On this estimate I would doubt. Last year the government struggled against low oil market by spending cuts in order to lower budget deficit. Now the government plans to raise internal consumer spending by extra payment for government workers and the introduction of value-added taxation (VAT) reform. These all may strive GDP up to 2.0% - 2.1% growth maximum (as per the expectation of barrel of oil at $70).

[Negative] Teg: China

There are rumors that in light of china's currency depreciation, the central bank is likely to tighten liquidity. Obviously, it will raise further concerns in relation to the growth outlook of China. I explain: the US tax reform is underway, and once to be carried out this will cause interest rate increase in the US market, the will result in capital flow from China into the US and will ultimately weaken the yuan. Thus I think that GDP growth will slow.

[Neutral] Teg: Germany

The main feature of German economy, as I think, is very high level of current accounts surplus (around 7-9% of GDP, this is one of the highest level within developed peers) This is one of the keys potential driver for economic growth. High surplus demonstrates that Germans and companies of the country still prefer to save rather than invest. The government should offer Germans some incentives to invest. Why not to increase a little bit of inflation (e.g. steady increase in wages, more government spending, etc.). I am sure this is like low-hanging fruits.

[Positive] Teg: Brazil

After recession in 2015-2016 Brazil shows strong signs of recovery. The major problem of Brazil economy was high inflation that led to (1) decreased real consumption (coupled with high unemployment rate), (2) higher interest rate (for both households and government). Banco Central do Brazil was able to take prices under control and, thus, ensuring a healthy mix of falling inflation and lower interest rates. The result is economy growth due to (1) private consumption increasing, (2) unemployment decreasing, (3) export increasing. Nevertheless, budget deficit remains high and that creates risks. That is why I assume that next steps might be (1) limitation of government expenses, (2) privatization, (3) pension reform (particularly, unpopular measures such as raise the retirement age).

[Positive] Teg: China

I believe that China is able to achieve its goal, announced in April 2018 by the Communist Party of China, to double real GDP by 2020 compared with the level in 2010, that would require real GDP growth to average at least 6.3% a year in 2018-2020. Money squeeze in 2017 will make negative impact on economic activity, however, I think this is likely to be offset by looser economic policy settings. Therefore consumption and investment growth will remain stable in 2018. The external sector is sensible to US-China trade tensions, but I don't expect an escalation into full-blown trade war that could have a major impact on GDP growth in China. And in spite this trade frictions I expect that China's large merchandise trade surplus will expand over 2018-2022. Also, according to my expectations, the consumer prices will grow by an average of 2.6% per year in 2018-2022

[Positive] Teg: Japan

I think the government will continue the course of economic revival, which provides bold monetary and flexible fiscal policies, as well as structural reforms. Extension of these policies in 2018-2019 will mean that by 2020 Japan will have completed its longest period of economic recovery since the 1980s. The government will continue to implement structural reforms, however, I think it will be difficult for the country to achieve its ambitious goal of expanding the economy to $6 trn to 2021. In spite of the last weak results of private consumption and investment spending, I expect that Japan's real GDP will show stable growth averaging 1.2% a year in 2018-2022, given by the continued support of flexible fiscal policy and steady growth in external demand. In addition, in 2018-2022 I expect surplus in trade account provided by global goods export growth, restarting of more nuclear power plants, as well as increasing tourist arrivals, especially due to Olympics in 2020.

[Positive] Teg: Canada

European import is the main driver for the economy of Canada. As per official sources of EU officers they are not expect any increase of imports of goods. In contrary China and US market's tend to increase import from Canadian business. Thus, I put moderate increase in GDP for the next 2 years

[Positive] Teg: Mexico

In 2017 foreign investments in Mexico fell due to uncertainty relating to USA commitments to NAFTA. This will result in poor growth of GDP for 2018. This goes together with domestic policy uncertainty remains until presidential election on 1st July 2018. After, I would suggest that we may expect pro-American president thus we may expect positive shifts in policy (mainly renegotiation of NAFTA with the USA). Growth in Mexico seems to be moderately higher in 2019 and 2020, at 2.5-2.7 percent per annum but this year 2018 - poor 1.0% - 1.9%

[Positive] Teg: Turkey

Turkey offers a good growth potential in terms of GDP for the next two years 2018-2019 with the real rate 5% as a minimum. This is driven by governmental fiscal stimulus and the increase of export. And I read many analysts bet on strong growth dynamics of Turkish economy. Main factors are oil price growth (export), internal consumption strengthening and attraction of new foreign investments, these drivers seem to continue feeding up the economy growth, although the increase might slow down to more moderate levels in mid-term. The growth in internal consumption is also base on the clear reduction dynamic of unemployment rate. Also, many tourists are coming back (e.g. from Russia) which makes businesses to be more optimistic for near future

[Negative] Teg: Japan

I expect that Japan economy will continue to grow with growth rate approximately equals to average growth rate in 2012-2017 (Abenomics beginning). The key driver for this is export growth (machinery, chemicals, and non-ferrous metals) due to weak yen and global economy growth. Monetary situation remains healthy as well: despite recent acceleration in inflation, its forecast is still below BoJ target. However, one should note several challenges for Japan economy: 1) Near-term challenges: (1) recent strengthening of yen that increases Japanese exporters concern, (2) weakness in consumer spending due to wages decreasing, as well as new housing construction falling. 2) Fundamental long-term challenge: planned increasing of national sales tax in 2019 from 8% to 10% to cover deficit in pension system (due to Japanese demographic situation). I assume that this will lead to economic growth slowing down (as in 2014 when this tax was increased from 5% to 8%)

[Positive] Teg: Germany

Germany is in a boom phase, with growth rate ~2.5% (the highest since 2011, when growth rate was 3.7% on the back of post-crisis recovery). This growth is fueled by booming real estate market (due to low interest rates), global growth, increasing investments (due to capacity utilization is at the highs) and increasing domestic demand (due to increasing wages and decreasing unemployment which is at the lows). Fiscal policy is rather stable as well: moderate stimulus with budget balance in surplus. I assume that current growth of Germany is rather stable in near-term. However, in 1-2 years there is a risk that real estate market, one of the catalyst, would be overheated, thus, slowing down of growth is possible.

[Negative] Teg: France

The government of France recently announced to raise energy and tobacco taxes pursuing to make growth reliing on green sectors and enhance the healthcare. The vogue for electric-car are growing fast. The fiscal stance is projected to be largely neutral over the projection horizon

[Positive] Teg: South Korea

In the near-term, I assume that Korean economy will be able to show relatively high growth rate (~3% in 2018-19) as a result of export growth (especially, in semiconductor industry) and fiscal stimulus (through government expenses increasing). In the long term, economic outlook is hazy as it relies on the possibility to solve fundamental economic problems (high level of unemployment, population ageing, high power of large enterprises called chaebol and low level of competitiveness), as well as on external political factors (negative - USA might withdraw from free-trade agreement, positive - possible recovery of relationship with North Korea).