IMF Issues Gloomy Warning Says Large Part of The World Will be in Recession in 2023
- The head of the International Monetary Fund, Kristalina Georgieva has issued a gloomy warning for the world economy
- Georgieva said about a third of the world would enter recession in 2023
- According to her, the EU, China and the US would witness, three of the world’s biggest economies would contract
2023 is predicted to be economically turbulent for a third of the world as major economies in the world would be in recession in 2023.
According to the head of the International Monetary Fund (IMF), Kristalina Georgieva warned that it is going to be a tough 2023 for top economies like China, the US and Europe which will all experience weakening economic activities.
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China, Europe, China will see troubled economic growth
The Managing Director of IMF revealed this on Sunday, January 1, 2023, on the television programme, Face the Nation.
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She said the three biggest economies in the world would witness simultaneous contraction economically.
She said:
“We expect one-third of the world economy to be in recession. Even countries that are not in recession, it would feel like a recession for hundreds of millions of people.”
The Guardian reports that in October, IMF cut the global economic outlook for 2023, saying that the war in Ukraine as well as inflationary pressures and high-interest rates by central banks such as the US Federal Reserve meant to bridge the price pressure.
According to Georgieva, China is likely to witness growth or grow below the global growth rate for the first time in four decades as the country lifts its zero COVID-19 policy, causing a surge in the pandemic in the country.
She said the recent surge in infections in China will slow the country’s economic growth and drag the Asian region back, saying it would be tough for China and impact negatively on the world’s second-largest economy.
US job market may witness growth
However, Georgieva said the US economy is on a strong footing and may avoid the coming contraction that may afflict as much as a third of the world economies.
She said the US economy is resilient and may avoid the looming recession as the country’s labour market picks up and stays strong.
She believes that if the US labour market is strong, the Federal Reserve may keep interest rates tighter for longer to bring inflation down.
The country’s job market will be the focal point for the Federal Reserve officials who would like to see demand for labour ease to help cut price pressures.
Nigeria Missing as IMF Lists 7 Fastest-growing economies in Africa in 2023
Legit.ng reports that according to the International Monetary Fund (IMF), Africa’s economic recovery has been abruptly interrupted but in 2021, activities bounced back and lifted GDP growth in the continent to 4.7 per cent.
Growth in 2022 is expected to decline by more than one per cent point to 3.6 per cent as global slowdown, tighter financial conditions and a surprising recovery in global inflation spiral into Africa already weighted down by a series of economic shocks.
The World Bank said 29 out of the 33 countries in Africa with verifiable data had 5 per cent inflation in July while 17 countries were in double digits.
Source: Legit.ng
