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Source Title: Financial Observation | The long way to go for global economic recovery, China’s economic resilience is recognized
Xinhua News Agency, Washington, October 14 (Reporter Xu Yuangaopan) The International Monetary Fund (IMF) released the “World Economic Outlook Report” on the 13th, predicting that the world economy will contract 4.4% this year. China is the only major economy in the world that has achieved positive growth. The annual growth rate is expected to reach 1.9%, and the IMF has affirmed its resistance to development.
The global economic recovery is better than expected
The report shows that, based on baseline assumptions, such as a stronger-than-expected economy in the second quarter, policy support and exchange rate maintenance at current levels, and social distancing through 2021, the The IMF expects the world economy to contract 4.4% this year, an increase of 0.8 percentage points from its June forecast. .
Specifically, the economies of developed economies will contract by 5.8% this year and the economies of emerging markets and developing economies will contract by 3.3%. Among them, the US economy will contract by 4.3%, the euro zone economy will contract by 8.3% and the Japanese economy will contract by 5.3%, both above the June forecast. The Indian economy will contract 10.3%, 5.8 percentage points less than the June forecast.
The IMF believes that with the relaxation of lockdown measures and large-scale political support from governments and central banks, the global economy is recovering from the recession in the first half of this year, market confidence will also decline. has boosted and global equity markets have generally strengthened since June.
The IMF affirmed the resilience and development prospects of the Chinese economy. The report said that since the beginning of April, China’s economic activities have normalized faster than expected. The economy achieved positive growth in the second quarter and China has also become a major contributor to the recovery in world trade. China’s economy will continue to grow next year and the growth rate is expected to reach 8.2%.
This photo taken in Washington, USA on October 14 shows Georgieva, president of the International Monetary Fund (IMF), is broadcasting the press conference on television. (Photo by Xinhua News Agency reporter Liu Jie)
The global economic recovery has a long way to go
Although the recovery is better than expected, the IMF believes that the world economy is still in a deep recession, facing a long, uneven, highly uncertain and difficult escalation.
The report predicts that the world economy will grow 5.2% next year, a decrease of 0.2% from the June forecast; the global economic growth rate will gradually slow down to around 3.5% in the medium term.
The employment rate is still much lower than before the outbreak. IMF chief economist Geeta Gopinat said labor market polarization is becoming more severe and low-income groups, youth and women are being hit the hardest.
The IMF also believes that increased trade and investment restrictions and growing geopolitical uncertainties will hurt the economic recovery, and rising bankruptcies and overvaluation of financial markets will also make many economies more vulnerable.
This is the International Monetary Fund headquarters building in the rain taken in Washington, the capital of the United States, on April 13. (Photo by Xinhua News Agency reporter Liu Jie)
Strengthen policy support and multilateral cooperation
The report says the world economy is in its worst recession in decades and the downside risks are enormous. To ensure a lasting recovery, economies still need to take further action.
First, it is necessary to strengthen international cooperation. Gopinath called on the international community to support low-income economies through debt relief, grants, and preferential financing, to promote the widespread recovery of the world economy.
Second, strengthen the relevance of policies. IMF President Georgieva said economies must avoid premature withdrawal of policy support, and that forward-looking and flexible fiscal policies are essential to achieve a stable recovery.
In addition, when formulating policies, you must focus on achieving stronger, fairer and more sustainable economic growth. Georgieva believes that all economies should increase their support for public services represented by green environmental protection projects, create more jobs, and accelerate digital transformation to increase productivity.
