A third of the global economy will be in recession this year, according to the head of the IMF, who also warned that 2023 will be “tougher” than last year as the economies of the United States, the European Union, and China slow down.
Kristalina Georgieva, the head of the International Monetary Fund (IMF), made these gloomy claims on “Face the Nation” on CBS on Sunday. It comes at a time when the protracted conflict in Ukraine shows no signs of abating after more than ten months when inflation is spiralling out of control, interest rates are rising, and the Omicron variety is fueling a surge in coronavirus infections in China.
“We anticipate that one-third of the global economy will be in recession,” Georgieva stated on a news programme.
She stated that 2023 will be more difficult than 2022 because the economies of the United States, the European Union, and China will slow down.
“Even in countries that are not in recession, hundreds of millions of people will experience recession-like conditions,” she noted.
In October of last year, the IMF reduced its 2023 growth prediction.
“Global growth is anticipated to decrease from 6% in 2021 to 3.2% in 2022 and 2.7% in 2023. This is the worst growth profile since 2001, except for the global financial crisis and the acute period of the COVID-19 pandemic, according to the report.
China has abandoned its zero Covid policy and opened its economy in response to a surge of anti-government demonstrations.
“For the next couple of months, it will be difficult for China, and the impact on Chinese growth will be negative, as will the impact on regional and world growth,” she added.