IMF Forecasts China's Economic Growth Rate at 5.6% Next Year... Core Reforms Needed

[Image source=AFP Yonhap News]

[Asia Economy Reporter Yuri Kim] The International Monetary Fund (IMF) forecasted China's economic growth rate at 5.6% next year and stated that a 'core reform' is necessary.

According to China's state-run China Daily and Hong Kong's South China Morning Post (SCMP) on the 20th, the IMF said in a statement related to the annual consultation on China that core reforms are needed for China to achieve quality economic growth.

The IMF provides policy recommendations through annual consultations with member countries under Article 4 of the agreement. In the statement, the IMF pointed out that support policies are necessary for China to achieve quality growth amid ongoing uncertainties surrounding the COVID-19 situation and vulnerabilities in consumption and fiscal conditions.

Geoffrey Okamoto, IMF Deputy Managing Director, diagnosed that "China's economic recovery is progressing rapidly but is uneven and momentum is slowing." The IMF recommended preparing countermeasures against the possibility of a fiscal crisis, citing increased uncertainties in the Chinese economy due to debt restructuring and strengthened regulations on technology companies by Chinese authorities.

The IMF previously predicted that China's economic growth rate would reach 8% this year.

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