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While governments around the world say the economy will recover from 2021, the World Bank and the International Monetary Fund have recently released gloomy forecasts.
According to estimates by the International Monetary Fund, the performance of the global economy will be 11 billion euros lower in 2020 and 2021. It will be “the worst recession” since the global economic crisis 90 years ago, said IMF chief economist Gita. Gopinath. “No country will escape intact,” he added.
For comparison, the gross value performance of the German economy in 2019 was just over € 3 billion, Deutsche Welle notes. As a consequence of the crisis, public debt will exceed this year, in terms of economic performance, the maximum level registered at the end of the Second World War.
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The IMF expects a recovery in 2021, with an increase of 5.4 percent. But according to Gita Gopinath, this positive development will only take place if there is no third wave of the COVID-19 pandemic.
However, experts in Washington warn that estimates could worsen if uncertainties about the pandemic and potential constraints on the economy and public life linger. For industrialized countries, the World Bank anticipates a decrease of 7%, for emerging countries a decrease of 2.5% and for the euro zone a record decrease of 9.1%. Instead, the institution’s experts expect the economy of China, the country where COVID-19 appeared, to grow 1%.
The IMF warning does not scare Romanian officials. The Minister of Public Finance, Florin Cîţu, announced that he excludes the option of an agreement with the International Monetary Fund, specifying that once the confidence of the international market has been won, a large deficit can be financed without the need for financial institutions.
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Florin Cîţu was asked on Monday, at a press conference, if he excludes the option of an agreement with the International Monetary Fund.
“I exclude the possibility of an agreement with the International Monetary Fund. We have shown this year that if you have earned the trust of the market, you can finance a large deficit without the need for international financial institutions. That deficit financed to pay for health, these aid schemes, we had record investments, so there is no need for an agreement with the IMF. From my point of view, I tell you clearly, there are no such discussions. I found these documents through the ministry when it was discussed with the Monetary Fund last year in September, when after a discussion with the Monetary Fund that document was made in the Government where it was very clear that pensions will not rise by 40% . We are not considering a loan from the IMF, we have financing for this year. The financing need for this year is almost 97% covered. We do not have any financing problem ”, explained the Minister of Finance.
Prime Minister Ludovic Orban also rejected a future agreement with the International Monetary Fund to obtain financing from the state budget for 2021. The prime minister said that “a new agreement with the IMF is not necessary”, although an agreement can be reached , because the Fund offers the possibility of financing the budget deficit. There are also other sources of income, such as European funds or financing from the European Investment Bank (EIB) or the European Bank for Reconstruction and Development (EBRD), Prime Minister Ludovic Orban said in an interview with Europe. free.
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