WASHINGTON: The International Monetary Fund (IMF) estimates that global economic growth in 2021 fell slightly below its estimate at 6%, the Head of the IMF Crystalina Georgieva said on Tuesday, quoting risks related to debt, inflation and different economic trends after the Covid Pandemic Deals .
Georgieva said the global economy bounced back but the pandemic continued to limit recovery, with the main obstacles posed by the “great vaccination gap” which had left too many countries with too little Covid vaccine.
In virtual speech at Bocconi University in Italy, Georgieva said the outlook for the world’s economy that was updated next week would estimate that the advanced economy would return to the pre-pandemic economic output level in 2022 but most developing and developing countries would require “many years” recover.
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“We face a global recovery that is still ‘limited’ by a pandemic and its impact.
We can’t walk properly – it’s like walking with stones in our shoes,” he said.
The United States and China remain vital growth machines, and Italy and Europe showed increased momentum, but growth deteriorated elsewhere, said Georgieva.
Inflationary pressure, the main risk factor, is expected to subside in most countries in 2022 but will continue to affect the economics that emerge and develop, he said, warning that increased sustainable inflation expectations can cause a more stringent interest rate and financial rates.
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While the central bank can generally avoid tightening for now, they must be ready to act quickly if recovery strengthens faster than expected or the risk of increasing inflation, he said.
He said it was also important to monitor financial risks, including asset assessions that stretched.
The level of global debt, now around 100% of world gross domestic products, means that many developing countries have very limited abilities to issue new debt in favorable conditions, said Georgieva.
Georgieva said it was important that debt restructuring efforts had been initiated by Zambia, Chad and Ethiopia successfully resolved successfully to encourage others to seek help.
Better transparency about debt, healthy debt management practices and expanded regulatory framework will help ensure increasing private sector participation, he said in response to questions from participants.
Asked about increasing debt levels in Europe, Georgieva said the growing economic momentum had placed Europe to the sound footing to avoid a sovereign debt crisis as faced by Greece after the 2007-08 global financial crisis.
But he said countries must be carefully planned how to move courses to medium-term fiscal consolidation to remove an increase in the debt burden related to a pandemic.
“The bill will come maturity,” he said, adding that good planning is needed to ease the burden of debt over time while avoiding “brutal” cuts in education or funding for health care.
Speeding up shipping Georgieva vaccine urging richer nations to increase the delivery of Covid-19 vaccines to developing countries, removing trade restrictions and closing the gap of $ 20 billion in grant funds needed for testing, search and therapeutics.
Failure to close large gaps in the level of vaccination between advanced economies and poor countries can withstand global recovery, riding a cumulative global GDP loss to $ 5.3 trillion over the next five years, he said.
Georgieva said countries must also accelerate efforts to overcome climate change, ensure technology changes and binding inclusion – all of which can increase economic growth.
Renewable energy shifts, new electricity networks, energy efficiency and low carbon mobility can increase global GDP about 2% of this decade, creating 30 million new jobs, he said.
The IMF looked at Global GDP in 2021 a little below the previous estimate of 6%
