The IMF predicts that the global economy will grow by 5.9% in 2021 and calls on –
Strengthen multilateral cooperation and promote the continuous recovery of the global economy (international perspective)
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The current global economy continues to recover, but at the same time it faces multiple risks such as supply chain disruption and increased uncertainty in the epidemic. The International Monetary Fund urges economies to speed up vaccine production and distribution under a multilateral framework, and through multilateral efforts to ensure that restricted economies obtain sufficient liquidity, to ensure that the global economy overcomes difficulties and achieves sustainable growth.
The International Monetary Fund (IMF) released the latest “World Economic Outlook Report” on October 12, which believes that the global economy is expected to continue to recover in 2021 but the momentum is slowing down. The annual growth rate is expected to be 5.9%, which is lower than the July forecast. 0.1 percentage point. The IMF calls on all economies around the world to strengthen multilateral cooperation to promote sustainable growth of the global economy.
Economic growth has diverged
According to the latest issue of the World Economic Outlook Report, the economies of advanced economies will grow by 5.2% in 2021, a decrease of 0.4 percentage points from the July forecast. Among them, the U.S. economy will grow by 6%, the Eurozone economy will grow by 5%, the Japanese economy will grow by 2.4%, and the UK economy will grow by 6.8%; the economies of emerging markets and developing economies will grow by 6.4%, up from the July forecast. 0.1 percentage point. Among them, the Russian economy will grow by 4.7%, and the Brazilian economy will grow by 5.2%. The report predicts that the global economy is expected to grow by 4.9% in 2022, which is the same as the July forecast.
The report pointed out that the downward revision of this year’s global economic growth forecast mainly reflects the slowdown in the growth of advanced economies under the influence of supply chain disruption, and the deterioration of the epidemic situation in low-income developing economies, which has led to a narrowing of economic growth. However, the economies of emerging markets and developing economies that partly rely on commodity exports are expected to strengthen in the short term.
IMF chief economist Geeta Gopinat said that due to factors such as differences in vaccine availability and policy support, the economic prospects of various economies have diverged. This is the main problem facing the global economic recovery. At present, nearly 60% of the population in developed economies have been fully vaccinated, and about 96% of the population in low-income economies are still unvaccinated. Affected by the epidemic and unfavorable climate, some countries have experienced shortages of major production inputs and weak manufacturing activities. The tight supply coupled with the release of pent-up demand and the rebound in commodity prices have led to severe inflation in many economies, and policy responses have become more difficult.
The IMF recommends that in the face of increasing uncertainties in the outlook for global growth, central banks should be prepared to act quickly when the risk of rising inflation expectations becomes clearer. “We predict that headline inflation in advanced economies, as well as emerging markets and developing economies, is likely to return to pre-epidemic levels before mid-2022.” Geeta Gopinat said.
Comprehensive measures to cope with risks
The “World Economic Outlook Report” believes that the current global economic outlook faces multiple risks, the root of which is that the world will be “subjected” to the epidemic for a long time and continuously. It is necessary for all economies to strengthen cooperation to accelerate vaccine production and distribution under a multilateral framework to ensure that restricted economies obtain sufficient liquidity.
The IMF calls on economies with conditions to give priority to vaccine shortage areas and supports developing economies to expand vaccine production. At the same time, the international community needs to quickly remove restrictions on the export of medical equipment, raw materials and finished vaccines to promote vaccine sharing. Marha Nabar, the head of world economics of the IMF Research Department, told our reporter: “The first task is to promote the vaccine to all countries around the world, including enabling low-income developing countries to obtain the vaccine as soon as possible.”
IMF President Georgieva recently called on all economies to take strong policy measures, act decisively at the national and multilateral levels, accelerate the process of universal vaccination, and adjust monetary and fiscal policies according to their own national conditions. On this basis, all economies should accelerate reforms, realize economic transformation, and do a good job in responding to climate change, promoting technological change, and achieving inclusive development.
Geeta Gopinath said that the international community must take full action to ensure that all countries have fair access to vaccines. In addition, strengthening global climate cooperation, reducing the increasingly serious adverse effects of climate change, and coordinated multilateral actions by all parties to ensure adequate international liquidity for capital-constrained economies are all important considerations for all countries. Policy options.
China’s economic prospects continue to be optimistic
The report continues to be optimistic about China’s economic development prospects. “We predict that China’s future economic growth will maintain a strong momentum.” Malha Nabal said that the Chinese government pays close attention to various possible economic risks and has issued a series of response policies to ensure the steady recovery of China’s economy.
The latest IMF Global Financial Stability Report also shows that as China’s economy recovers faster than other emerging economies, China’s sovereign credit rating is significantly higher than that of other emerging economies and remained stable during the epidemic. Chinese stocks and bonds are included in more Global financial market benchmark index, since 2020, China has attracted about 180 billion US dollars of international capital inflows.
Since the outbreak of the epidemic, China has been the main engine driving the recovery of the global economy. In addition to the IMF, many international institutions such as the World Bank, the Asian Development Bank, and the Organization for Economic Cooperation and Development are also optimistic about China’s economic development prospects and maintain China’s 2021 economic growth forecast at the world’s leading level, believing that China will continue to be the global economy The recovery has made an important contribution.
The New York Times website recently published an article saying that some well-known Wall Street investment institutions believe that China’s investment prospects are “more optimistic than ever.” The Chinese government provides global investment institutions with better opportunities to serve Chinese companies and investors. BlackRock, the world‘s largest asset management company, recommends that investors triple their investment in China.
(People’s Daily, Washington, October 13th)
“People’s Daily” (17th edition on October 14, 2021)
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