WORLD IMF revises down global economy forecast to 5.9 percent in 2021

WORLD

IMF revises down global economy forecast to 5.9 percent in 2021

Xinhua

21:05, October 12, 2021

WASHINGTON, Oct. 12 (Xinhua) -- The International Monetary Fund (IMF) on Tuesday projected that the global economy would grow by 5.9 percent in 2021, down by 0.1 percentage points from July's forecast, according to the latest World Economic Outlook.

Cargo containers at the Kwai Tsing Container Terminals in Hong Kong. (File photo: AFP)

"The global recovery continues but momentum has weakened, hobbled by the pandemic," IMF Chief Economist Gita Gopinath told a virtual press briefing during the annual meetings of the IMF and the World Bank Group.

Fueled by the highly transmissible Delta variant, the recorded global COVID-19 death toll has risen close to 5 million and health risks abound, "holding back a full return to normalcy," Gopinath noted.

"Pandemic outbreaks in critical links of global supply chains have resulted in longer than expected supply disruptions, feeding inflation in many countries," she continued.

Noting that overall risks to economic prospects have increased and policy trade-offs have become "more complex," the IMF chief economist said the "modest headline revision" for the global economy "masks large downgrades for some countries."

"The outlook for the low-income developing country group has darkened considerably due to worsening pandemic dynamics," she said.

Stressing that the "dangerous divergence" in economic prospects across countries remains a major concern, Gopinath said these divergences are a consequence of the "great vaccine divide" and large disparities in policy support.

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