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Saturday, December 4, 2021

The IMF sees global GDP in 2021 slightly below the forecast of 6 percent

WASHINGTON – The International Monetary Fund expects global economic growth to fall slightly below the 20 percent forecast for July 2021, IMF chief Kristalina Georgieva said on Tuesday, citing risks related to debt, inflation and different economic trends. 19 epidemics.

Georgieva said the global economy is recovering but the epidemic continues to limit recovery, a major obstacle to the “Great Vaccination Divide” that has left many countries with very little access to the Covid-1 vaccine.

In a virtual speech at the University of Bocconi in Italy, Georgieva said the updated World Economic Outlook next week would predict that developed economies would return to pre-epidemic levels by 2022 but that “many more years” would be needed to recover most emerging and developing countries.

“We are facing a global recovery that is‘ stuck ’by the epidemic and its effects. We can’t walk right in front – it’s like walking with our shoes on stones.

Georgieva said the United States and China remain important engines of growth and Italy and Europe have shown increasing momentum, but growth is getting worse elsewhere.

Inflationary pressures, a major risk factor, were expected to ease in most countries in 2022 but will continue to have an impact on some emerging and developing economies, he said.

While central banks may generally avoid tightening for the time being, they need to be prepared to act faster if recovery is faster than expected or if the risk of rapid inflation is implemented, he said.

He said it is also important to monitor financial risks, including valuations of expanded assets.

Georgieva said the level of global debt, which is now about 100 percent of the world’s gross domestic product, means that many developing countries have very limited ability to provide new debt under favorable conditions.

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Georgieva said the debt restructuring efforts already underway by Zambia, Chad and Ethiopia should be successfully completed so that others can be encouraged to seek help.

International Monetary Fund (IMF) Building Sign, April 5, 2016 in Washington. (Photo by Karen Blair / AFP / Getty Images)

Responding to a question from a participant, he said more transparency about ts, better debt management practices and a broader regulatory structure would help.

Asked about the level of rising debt in Europe, Georgieva said the growing economic momentum had kept Europe in a strong position to avoid another sovereign debt crisis facing Greece after the 2007-08 global financial crisis.

But he said countries need to carefully plan how to move toward medium-term fiscal consolidation to eliminate the burden of epidemic-related debt.

“The bills are coming,” he said, adding that better planning was needed to alleviate the debt burden over time while avoiding “brutal” cuts in education or health care funds.

Accelerate vaccine delivery

Georgia called on rich countries to increase the supply of Covid-1 vaccine to developing countries, lift trade restrictions and close the ২০ 20 billion gap in funding for Covid-1 testing, tracing and therapeutics.

He said the failure to close the wide gap in vaccination rates between developed economies and poor countries could stem global recovery, which would lead to a total global GDP loss of 5. 5.3 trillion over the next five years.

Written by Andrea Shalal

Reuters

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This News Originally From – The Epoch Times

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