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The Long-Term Investment Challenge

An extended global economic slump may be inevitable, but it can be mitigated. Adopting policies to facilitate and reward long-term investments will be key to exiting the current crisis and boosting the world’s potential for growth in the future.

PARIS – As the deepest economic crisis of our lifetimes stretches into its seventh year, most OECD countries are continuing to underperform. This year, GDP growth in the world’s advanced economies is expected to average 2%, compared to 3.2% worldwide. And 2016 is shaping up to be no better, with output in the OECD growing by 2.5%, while the rest of the world’s GDP expands at a 3.8% rate – close to the pre-crisis average.

But the long-term economic prospects of the global economy as a whole look gloomy. As societies in many OECD countries age, and catch-up growth in large emerging economies begins to wind down, global GDP growth is expected to fall from its annual average of 3.6% in the 2010-2020 period to an estimated 2.4% in 2050-2060.

This slump may be inevitable, but it can be mitigated. Implementing policies to facilitate and reward long-term investments will be key to exiting the current crisis and boosting the world’s growth potential.

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