David Cameron warns of looming second global crash

Patrick Wintour in Brisbane
Monday 17 November 2014 05.08 EST

PM says 'red warning lights are flashing' against a backdrop of instability and uncertainty, as G20 summit draws to a close

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David Cameron has issued a stark message that "red warning lights are flashing on the dashboard of the global economy" in the same way as when the financial crash brought the world to its knees six years ago.
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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.
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His warning comes days after the Bank of England governor, Mark Carney, claimed a spectre of stagnation was haunting Europe. The International Monetary Fund managing director, Christine Lagarde, expressed fears in Brisbane that a diet of high debt, low growth and unemployment may yet become "the new normal in Europe".
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Cameron has adopted the more sombre tone in the runup to the chancellor's autumn statement on 3 December, when the Office of Budget Responsibility will produce new growth forecasts and spell out the impact on public finances.
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"The eurozone is teetering on the brink of a possible third recession, with high unemployment, falling growth and the real risk of falling prices too," Cameron writes. "Emerging market economies which were the driver of growth in the early stages of the recovery are now slowing down. Despite the progress in Bali [trade talks in 2013], global trade talks have stalled while the epidemic of Ebola, conflict in the Middle East and Russia's illegal actions in Ukraine are all adding a dangerous backdrop of instability and uncertainty."
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