IMF Managing Director: "Global Economy Setback Due to Ukraine War... Growth Forecasts Downgraded for 143 Countries"

[Image source=Reuters Yonhap News]

원본보기 아이콘

[Asia Economy Reporter Kim Hyunjung] Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF), stated on the 14th (local time) that the global economy is significantly deteriorating due to the impact of the Ukraine war and other factors, and announced plans to downgrade growth forecasts for 143 countries.

According to The Wall Street Journal (WSJ), Georgieva said in a speech at the Carnegie Endowment for International Peace that day, "Russia's invasion of Ukraine is delivering a shock to the global economy, causing major disruptions to the efforts of countries to recover from COVID-19." She added, "Ukraine will suffer devastating economic losses, and Russia will also experience severe contraction."

She mentioned that most countries are expected to face low growth rates and high inflation, and revealed plans to revise downward the growth forecasts for 143 countries, which account for 86% of the global economy, at the upcoming IMF and World Bank (WB) Spring Meetings next week.

Georgieva expressed particular concern that the war between Ukraine and Russia, major exporters of wheat and fertilizer, could lead to severe damage from rising food prices in some regions such as South Africa and Latin American countries.

The IMF also noted that inflation this week reached a 40-year high in the United States and a 30-year high in the United Kingdom, forecasting that rapid price increases will continue for some time.

She emphasized that the mission of central banks and economic policymakers is "to curb high inflation and rising debt while maintaining key expenditures and building a foundation for sustainable growth." She further stressed, "Central banks facing these challenges must understand economic trends, appropriately adjust policies, act decisively, and communicate clearly."

The IMF had previously announced a global economic growth forecast of 4.4% in January, reflecting the Omicron wave, supply chain disruptions, and inflation, which was 0.5 percentage points lower than the forecast made in October last year.

© The Asia Business Daily(www.asiae.co.kr). All rights reserved.