Global economic growth is at its slowest pace in three years according to a new report from the World Bank – with any momentum both fragile and subject to substantial risks including escalation of trade disputes between the larger economies.

International trade and investment have been weaker than expected at the start of the year, and economic activity in major advanced economies, particularly the Euro Area, and some large emerging market and developing economies, has been softer than previously anticipated, the bank says.

Growth in the emerging and developing world is expected to pick up next year as the turbulence and uncertainty that afflicted a number of countries late last year and this year recedes, reports the June 2019 Global Economic Prospects: Heightened Tensions, Subdued Investment.

It notes that among the risks that could disrupt the delicate momentum is a further escalation of trade disputes between the world’s largest economies, renewed financial turmoil in emerging and developing economies, or a more abrupt deceleration of economic growth among major economies than is currently envisioned.

Also among concerns is a slowdown in global trade growth to the lowest level since the financial crisis ten years ago, and a tumble in business confidence as well as rising debt levels.

“Stronger economic growth is essential to reducing poverty and improving living standards,” says World Bank Group president David Malpass. “Current economic momentum remains weak, while heightened debt levels and subdued investment growth in developing economies are holding countries back from achieving their potential.

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“It is urgent that countries make significant structural reforms that improve the business climate and attract investment. They also need to make debt management and transparency a high priority so that new debt adds to growth and investment.”