Warning about an economic slowdown, the IMF chief said the world economy is expected to grow by less than 3 per cent this fiscal year, while India and China are expected to account for half of global growth in 2023. Kristalina Georgieva, managing director of the International Monetary Fund (IMF), warned of a similar economic situation this year as last year, with the world economy in sharp recession, fueled by a raging pandemic and Russia’s military invasion of Ukraine. It happened later.
The period of slow economic activity will be prolonged, with the next five years seeing less than 3 percent growth, “our lowest medium-term growth forecast since 1990, and well below the 3.8 percent average for the past two decades,” he said. Said. “Some of the momentum comes from emerging economies – Asia in particular is a bright spot. India and China are expected to account for half of global growth in 2023. But others face a steeper climb,” she explained. .
“A strong recovery in 2021 was followed by severe shocks from Russia’s war in Ukraine and its wider consequences – with global growth falling almost in half from 6.1 to 3.4 percent in 2022,” Georgieva said. He further said that slower growth would be a “severe blow”, making it even more difficult for low-income countries to catch up. “Poverty and hunger could increase further, an alarming trend that was started by the COVID crisis,” she explained.
His comments come ahead of the spring meetings of the IMF and World Bank next week, where policy-makers will convene to discuss the global economy’s most pressing issues. The annual gathering will take place as central banks around the world continue to raise interest rates in a bid to tame rapidly rising inflation rates. He said that nearly 90 percent of advanced economies are projected to see a decline in their growth rates this year.
For low-income countries, higher borrowing costs come at a time of weaker demand for their exports, he added. Georgieva said that while the global banking system “has come a long way” since the 2008 financial crisis, “concerns remain about deficiencies that may be lurking not only in banks but also in non-banks. “Now is not the time for complacency.”
Read this also | Govt caps CNG, piped cooking gas rates, changes pricing formula
Read this also | RBI announces new central portal to track unclaimed deposits: Details