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After the global economy finished 2019 on a weak note, exporters across the UK and US are worried about their prospects for 2020, while Chinese firms believe that their economy will maintain a solid growth rate, according to research by non-bank trade finance provider Stenn.

In a poll of 700 senior executives at medium and large-sized businesses across the UK, US and China, Stenn found that while 93% of Chinese companies are certain of further economic growth in their country, almost half of UK and US businesses fear their country will go into recession in 2020, as Brexit woes, President Trump’s unpredictable trade policy, and sluggish manufacturing output start to bite.

“While the Chinese are confident their economy will grow as it moves beyond the US-China trade war, it’s a very different story in the UK and US,” says Kerstin Braun, president of Stenn Group. “Many UK businesses are concerned Brexit could cause the economy to shrink in 2020. It’s vital UK firms start investing again as they exit Brexit limbo. This is critical for long-term growth.” She adds that in the US, while some fundamentals such as employment are good, there are enough economic red flags to signal weakness in the second half of 2020. “For example, corporate and government debt levels are high and personal loans are up more than 10% from a year ago. This makes the economy vulnerable to shocks and dependent on the Fed to keep interest rates low.”

Meanwhile, China’s exporters are doing better than expected. Customs data out this week shows that exports rose by 7.6% year-on-year in December, blowing past the 3.2% rise forecast by analysts polled by Reuters. An apparent thaw in relations between Beijing and Washington is likely to continue to support growth, with the US treasury department dropping its “currency manipulator” label on China ahead of a phase one trade deal set to be signed between the two sides today.

However, it’s not all sunshine from the Chinese perspective. A closer look at the figures shows a quarter of Chinese firms think the Asian giant’s economy will only grow at 4-5% this year – sharply below the government’s annual goal of between 6 and 6.5%.

“This comes after China’s economic growth rate slowed to a near 30-year low in Q3 2019, affecting people via the jobs market,” says Braun. “We’ve already seen unemployment rates at historical highs in 2019. While we don’t expect further improvements this year, we expect social inequality in China to increase over time.”

Fears over economic growth have a measurable impact on trade activity, with uncertainty impacting short-term margins and long-term investment plans for companies with international supply chains. The Stenn study also looked into the largest risks to businesses in 2020 across the globe, with similar themes emerging.

In the UK, increased geopolitical tensions such as trade tariffs, Brexit or regional instability, are cited as the number one risk to businesses, with environmental concerns and climate change ranking second.

In China, 64% of firms view a global recession or international financial crisis as the largest risk to business, closely followed by increased geopolitical tensions, at 62%, as firms navigate the threat of the US-China trade war.

Meanwhile, in the US, firms ranked the risk of increased geopolitical tension, increased environmental concerns, and changing consumer behaviour as equally urgent risks for the coming year.

“What’s most worrisome is global trade. The capricious US-China tariff war, which started as a security and tech war, has turned into political theatre at the expense of real businesses, while trade in and out of the UK after Brexit is still under threat. With the phase one agreement on January 15, one part of the trade war might come to an end but the tech war is likely to continue with no solution in sight,” says Braun.

Although Stenn’s research has a third of UK firms and US firms expecting to see a global recession or international global crisis in 2020, the current economist consensus is marginally less alarmist, with Oxford Economics putting the probability of a global recession this year at 25% – revised down from 30% at the end of last year.

“While we are a little more confident that global growth will pick up beyond Q1, we still expect the improvement to be steady and unspectacular. Recent economic data hasn’t been uniformly positive, and while US-China trade concerns have receded, apprehension over a US-Iran conflict has filled the void,” says Ben May, director of global macro research at Oxford Economics. He adds that he expects global GDP growth in 2020 to average just 2.5%, a touch weaker than the likely 2019 outturn of 2.6%, leaving growth at around its post-global financial crisis low.

Whether the polled businesses’ worst fears will come to pass remains to be seen, but for now, sentiment among exporters in some of the world’s largest economies is worryingly low.