David Cameron warned last night that the global economy risked another crash and said in an article that 'red warning lights' were 'flashing on the dashboard of the global economy' and the eurozone was 'teetering on the brink' of another recession.
The warning came at the same time that the world’s largest economy, Japan, fell into another recession. Japan shrank by an annualised 1.6% in the third quarter. This followed a huge 7.3% contraction in the previous quarter caused by a rise in the national sales tax and ran counter to economists forecasts for a 2.1% rebound.
Mr. Cameron's warning follows a claim by Bank of England governor Mark Carney that a 'spectre' of economic stagnation was haunting Europe. Christine Lagarde, managing director of the International Monetary Fund, has also expressed fears that a diet of high debt, low growth and unemployment may yet become 'the new normal in Europe.'
Writing in the Guardian at the close of the G20 summit in Brisbane, Cameron says there is now “a dangerous backdrop of instability and uncertainty” that presents a real risk to the UK recovery, adding that the eurozone slowdown is already having an impact on British exports and manufacturing.
Mr. Cameron said global instability such as the continued eurozone crisis and the ebola outbreak threatened the UK's recovery.
The G20 summit in Brisbane seems to have been a highly entertaining affair. Albeit for all the wrong reasons.
The 20 richest countries in the world pledged to magic up 2.1% of economic growth over the next five years. How this is suddenly possible after six years of failure is unclear, but it makes for good PR. Climate change was also high on the agenda.
But it was the brow-beating of Vladimir Putin by the leaders of the increasingly repressive free world that got most of the media attention. Canada's Harper reluctantly shook Putin's hand while demanding Russia pull out of Ukraine or face the might of Canada.
Australia's assistant secretary of defense was sent to greet him. Merkel said the EU is considering further sanctions even as protests by farmers across Europe are erupting due to the loss of the Russian export market.
Obama assured the G20 that the US, who have waged a series of bloody and costly wars since 2002, would lead the charge against Russia's aggression against Ukraine, "which is a threat to the world, as we saw with the appalling shoot-down of MH17" - the Malaysian Airlines flight which was shot down over Ukraine in July.
Australia's Abbott had threatened to "shirt front" - that is to physically confront - Putin over the atrocity which claimed 28 Australian lives.
Perhaps he was restrained from doing so due to the lack of evidence of Russian involvement in the attack on the plane which had been diverted from its regular flight path and directed over rebel held territory by Ukrainian air traffic control.