The global economy is recovering from a coronavirus pandemic faster than previously expected, largely due to the power of the United States, but the International Monetary Fund left developing countries on Tuesday with uneven vaccine deployments. I warned that there are still major challenges left because of the risk of doing so.
The IMF said it is improving its global growth forecast this year thanks to immunization of hundreds of millions of people. This is expected to help facilitate a rapid recovery in economic activity. International organizations expect the global economy to grow 6% this year from the previous forecast of 5.5%, after shrinking 3.3% in 2020.
“Despite the high uncertainty about the pandemic pathway, it is becoming increasingly clear how to get out of this health and economic crisis,” said Gitagopinato, chief economist at the IMF, in a statement from the fund. Said. World Economic Outlook Report..
The exit from the crisis is led by the wealthiest countries, especially the United States, which is projected to grow its economy by 6.4% this year. According to the IMF, the euro area is projected to grow 4.4% and Japan to grow 3.3%.
China and India are expected to take the lead in emerging markets and developing countries. China’s economy is projected to grow by 8.4%, and India’s economy is projected to grow by 12.5%.
Gopinato acknowledged the strong financial support that the biggest economies provided to improve the outlook and pointed out the relief efforts enacted by the United States. The IMF estimates that without $ 16 trillion in global financial support, the economic impact of a pandemic could have tripled.
Despite the bright outlook, Gopinato said the global economy still faces “difficult” challenges.
Low-income countries face greater losses in economic production than developed countries, reversing the benefits of poverty reduction. And in developed countries, unskilled workers are hit hardest, and unemployed people may find it difficult to replace them.
“Much of the lost work is unlikely to come back as the crisis has accelerated the transformational power of digitalization and automation, requiring the relocation of workers across sectors. This will require tough revenue. There are often penalties, “says Gopinas.
The IMF warned that the prediction depends on the deployment of vaccines and the spread of viral variants. This can pose both public health and economic threats. The fund is also paying attention to US interest rates. US interest rates remain solid, but can pose financial risks if the Federal Reserve raises them unexpectedly.
The IMF is seeing a faster economic recovery as vaccines are deployed.
Source link The IMF is seeing a faster economic recovery as vaccines are deployed.