NEWS
06/01/2016 03:07 EDT | Updated 06/02/2017 01:12 EDT

OECD: Brexit, refugee crisis threaten world GDP growth; Canada estimate lowered

PARIS — The Organization for Economic Cooperation and Development is increasingly pessimistic about the global economy and is warning that the "low-growth trap" will continue if governments don't change tack on spending and trade.

Overall, the OECD is forecasting global growth of three per cent this year and 3.3 per cent next year.

Both are down 0.3 percentage point from its November outlook.

It's estimating Canada's gross domestic product will grow by 1.7 per cent this year and 2.2 per cent in 2017.

That's down from the OECD's November estimate of 2.0 per cent growth in Canadian GDP in 2016 and 2.3 per cent in 2017.

The OECD notes that Canada's resource sector has been contracting but says that the shrinkage will slow. It adds that activity in other parts of the economy will "gain traction."

Among the risks to the global outlook as a whole is a potential British exit from the European Union.

In its Global Economic Outlook, the OECD reiterated its view that a so-called vote for Brexit in the country's referendum this month "would depress growth in Europe and elsewhere substantially."

It says the refugee surge to Europe — and a lack of unified response — also threatens global financial stability.

— With files from The Canadian Press.