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By Xie Fang

The International Monetary Fund (IMF) released an updated version of its World Economic Outlook (WEO) on Monday, forecasting a weakening global economic expansion over the next two years.

The agency reckoned that the global economy grew by 3.7 percent in 2018, which would remain unchanged from the last edition of its WEO issued last October.

However, the world economic growth is projected to slow down to 3.5 percent in 2019 and 3.6 in 2020, 0.2 and 0.1 percentage point below last October's projections, according to the IMF.

The agency cited the trade frictions between China and the U.S., the continued slowdown of the Chinese economy, the uncertainties about the future of Brexit as well as Italy's deteriorating financial conditions as the main causes for the deceleration of the global economic growth.

The agency argued that although the world's two largest economies had reached a 90-day truce deal over their tit-for-tat tariff fights on Dec. 1, 2018, "the possibility of tensions resurfacing in this spring will still cast a shadow over global economic prospects."

The slowing growth pace of the Chinese economy also contributes to the downgraded world economic outlook, according to the IMF.

The agency said that "China's economy slowed in 2018 mainly due to financial regulatory tightening to rein in shadow banking activity and off-budget local government investment."

Compounded by the uncertainties over the trade issues with the U.S., which intensified China's economic slowdown toward the end of 2018, further  deceleration in the Chinese economy is projected for 2019, according to the IMF.

To cope with a weakening global economy, the agency called for broader multilateral cooperation among countries.

"Policymakers should cooperate to address sources of dissatisfaction with the rule-based trading system, reduce trade costs, and resolve disagreements without raising tariff and non-tariff barriers," said the IMF also suggested that both developed and developing countries adopt appropriate monetary and fiscal policies to stimulate their domestic economies.