Kristalina Georgieva, Director of the International Monetary Fund. File | photo credit: Reuters
A third of the global economy will be in recession this year, the IMF chief said, and warned that 2023 will be “tougher” than last year, as the US, EU and China will see their economies slow down.
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Kristalina Georgieva, the head of the International Monetary Fund (IMF) made the grim claims on Jan. 1 during a CBS news program “Face the Nation.” It comes at a time when the ongoing conflict in Ukraine shows no sign of abating after more than 10 months, with spiraling inflation, higher interest rates and China’s surge in coronavirus infections fueled by the Omicron variant.
“We expect a third of the global economy to be in recession,” Ms Georgieva told the news program.
“The year 2023 will be more difficult than last year as the economies of the United States, the EU and China will slow down,” she said. “Even in countries that aren’t in recession, it would look like a recession to hundreds of millions of people,” she explained. Last October, the IMF lowered its growth forecast for 2023.
“Global growth is expected to slow from 6% in 2021 to 3.2% in 2022 and 2.7% in 2023. This is the weakest growth profile since 2001, excluding the global financial crisis and of the acute phase of the COVID-19 pandemic,” he added. said.
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China has abandoned its zero-Covid policy and opened up its economy following a wave of anti-government protests in the country.
“In the next two months, it will be difficult for China, and the impact on Chinese growth will be negative, the impact on the region will be negative, the impact on global growth will be negative,” he said. she adds.