International Monetary Fund boosts eurozone’s growth forecast

Elias Hubbard
Апреля 6, 2021

Japan is expected to register 3.3 per cent growth this year and 2.5 per cent next year. Chief Economist at IMF Gita Gopinath said: We are now projecting a stronger recovery in 2021 and 2022 for the global economy compared to our previous forecast, with growth projected to be 6 per cent in 2021 and 4.4 per cent in 2022.

In its latest edition of World Economic Outlook, IMF said it expects India's GDP to grow 12.5 per cent in FY22, the highest among emerging and advanced economies.

The U.S. GDP level in 2022 is forecast to be higher than in a non-pandemic scenario - the only large economy for which this is true.

"The upgrades in global growth for 2021 and 2022 are mainly due to upgrades for advanced economies, particularly to a sizeable upgrade for the United States (1.3 percentage points) that is expected to grow at 6.4% this year". The SARB started keeping records in 1912.

The world's second-largest economy, China, which imposed a draconian COVID-19 clampdown a year ago and got a head start on an economic recovery, will record 8.4 per cent growth this year and 5.6 per cent in 2022, the International Monetary Fund estimates. The global economy shrank by 4.3 per cent a year ago, over two-and-a-half times more than during the global financial crisis of 2009. The IMF now says the COVID-19 recession is likely to leave a smaller scar on the global economy compared to the 2008 financial crisis.

Other economies are also expected to rebound this year albeit at a slower rate, as per the International Monetary Fund. "However, emerging market economies and low-income developing countries have been hit harder and are expected to suffer more significant medium-term losses", the report said.

The sub-Saharan Africa region - which includes Ghana, Kenya, South Africa and Nigeria - continues to feel the pandemic's impacts. While the Canadian economy has expanded for nine straight months through January, output remains about three per cent below pre-pandemic levels. China GDP growth was also upgraded by 0.3% to 8.4%. "Close to 95 million more people are estimated to have fallen below the threshold of extreme poverty in 2020 compared to pre-pandemic projections", the report read. "Unequal setbacks to schooling could further amplify income inequality". Policymakers should also be prepared to "flexibly adjust" policy support. Economic recoveries are diverging across countries and sectors, reflecting variation in pandemic-induced disruptions and the extent of policy support. "Right now, the emphasis should be on escaping the health crisis by prioritising healthcare spending-on vaccinations, treatments, and healthcare infrastructure".

The IMF also called for strong global cooperation - not only to narrow the gap in living standards of low-income developing countries but also to ensure the universal distribution of vaccines, at affordable prices.

Gopinath said the pandemic is yet to be defeated and virus cases are accelerating in many countries. "On the worldwide stage, first and foremost, countries need to work together to ensure universal vaccination".

Moves to bolster the IMF's emergency reserves could provide the US$44 billion needed to vaccinate 70% of the population in lower-and middle-income countries by the end of 2022, at no added cost to rich countries, a new Rockefeller Foundation report finds.

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