A similar warning was also conveyed by the IMF "Global Financial Stability Report" released last week, pointing out that the tightening United States' monetary policy, coupled with trade uncertainties, have discouraged capital inflows to emerging economies, weakened their currencies and depressed equity markets.
Saudi Arabia, the biggest Arab economy which contracted 0.9 per cent a year ago, will expand 2.2 and 2.4 per cent in 2018 and 2019, 0.3 and 0.5 percentage points higher than the July forecast. "Inflation is projected to fall to 12.4 percent in 2018, from 16.5 percent in 2017, and to rise to 13.5 percent in 2019", the report read in part.
Mr Milesi-Ferretti noted Nigeria's (economic) growth of about 1.9 per cent this year to rise to about 2.3 in 2019, with South African economy, now in technical recession at only 0.8 per cent growth rate this year.
Last year, China shipped goods worth $375 billion more to the US than it took in from the United States, a figure Trump has often said he wants to curb sharply in an effort to promote American businesses.
Adding that "with global public and private debt at an all-time high, any slight change in the wind could provoke capital outflows and economic instability in emerging markets, as we see in some of those markets".
The OECD has also revised down its global growth forecasts. "Should market participants start pricing in the possibility of protracted trade tensions, financial conditions could tighten significantly, increasing the tail risk to global growth and financial stability", the International Monetary Fund said.
"Trade policy reflects politics and politics remains unsettled in several countries, posing further risks", IMF chief economist Maurice Obstfeld told a press briefing in Bali, where the fund kicks off its annual meetings this week.
IMF's forecasts for Hong Kong's economic outlook are mixed: it raises its forecast for 2018 by 0.2 percentage points to 3.8%, while cutting its forecast for 2019 by 0.3 percentage points to 2.9%.
Also, the International Monetary Fund admits that though oil producing countries like Nigeria are going to benefit from higher prices, it sees signs of lower investment in manufacturing, coupled with weaker trade growth. So, while debt-related risks in China are large, there are also buffers.
Thus the expansion of the global economy would be reduced to around 2.9% both next year and in 2020.
While the global economy is still on track to match last year's pace, which was the strongest since 2011, the new outlook suggests fatigue is setting in and the overall performance masked divergence with mounting weakness in emerging markets from Brazil to Turkey.
She thus urged global economies to use the current growth momentum, ("because we still have it") to implement the right policy actions in the areas earlier outlined, so as to be able to achieve the goals set out for global economic prosperity.
Conditions in Europe and other major advanced economies have also remained "relatively easy", although investors have pushed back their expectations for the European Central Bank to lift interest rates, the report said.