In a brief but forceful message, Kristalina Georgieva, the managing director of the International Monetary Fund (IMF), commented that 2023 will be “harder than the year we left behind” in economic terms.
The head of the IMF spoke with CBS “Face the Nation” and commented that for a large part of the world economy, 2023 will be a difficult year, due to the fact that the main engines of growth, such as the United States, the European Union and China , they will experience a slowdown in their activities.
“The three main economies, the United States, the European Union and China, are slowing down simultaneously,” said the head of the IMF.
“We anticipate a third of the world economy to be in recession,” Georgieva said. “It would feel like a recession for hundreds of millions of people.”
The IMF leader explained that although the United States has a chance to avoid recession, the situation seems more complicated for Europe, because it has been more affected by the war in Ukraine, so “half of the European Union will be in recession ”.
On the other hand, he said it is likely that a sharp boom in expected Covid infections in China could further affect its economy in the coming months, dragging down regional and global growth.
“I was in China last week, in a bubble in a city where there is no Covid… But that’s not going to last once people start traveling,” Georgieva said. “Over the next several months, it will be difficult for China and the impact on Chinese growth will be negative, the impact on the region will be negative, the impact on global growth will be negative… For the first time in 40 years, the growth of China in 2022 will be equal to or less than world growth”.
For a quarter ago, the IMF had cut its outlook for global economic growth for 2023, arguing pressure from Russia’s war in Ukraine, inflationary pressures and high interest rates imposed by central banks like the Federal Reserve, which outline to keep them.
The IMF forecasts global growth of 2.7% for 2023, which is a decrease from the 3.2% projected in 2022.
You may also like:
– Bloomberg survey predicts a 70% chance that the US will fall into recession
– The Conference Board Leading Economic Index shows that the US economy fell 1% in November
– JPMorgan expects the US to fall into a mild economic recession next year