International Monetary Fund Director Kristalina Georgieva revealed, in a speech she delivered in Beijing yesterday (Sunday), that the risks to financial stability have increased, and called for continued caution despite moves by advanced economies to calm market pressures.
Georgieva confirmed her view that 2023 will be another year full of challenges, with global growth slowing to less than 3%, due to the repercussions of the pandemic, the war in Ukraine and tightening monetary policy.
She added, at the China Development Forum, that even with a better outlook for 2024, global growth would still be well below its historical average of 3.8%, and estimates would remain weak overall.
The IMF, which has forecast global growth of 2.9% for this year, is due to release new estimates next month.
"Policy makers in advanced economies have dealt decisively with the risks to financial stability in the aftermath of bank failures, but vigilance and caution remain," Georgieva said.
"Therefore, we continue to monitor developments closely and are working to assess the potential repercussions on the global economic outlook and global financial stability," she added, adding that the International Monetary Fund pays close attention to countries most at risk, especially low-income countries with high levels of debt.
She also warned against dividing the world into competing economic blocs, saying that this would lead to "a dangerous division that will make everyone poorer and less secure."
She pointed out that the strong economic recovery in China, which is expected to record a GDP growth of about 5.2% in 2023, gives some hope to the global economy, as China alone is expected to achieve a third of global growth in 2023.
Okaz (Beijing) @okaz_online
