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Business News/ Economy / 2023 will be ‘tougher’ for global economy, says IMF's Georgieva. Here's why
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2023 will be ‘tougher’ for global economy, says IMF's Georgieva. Here's why

In October, the IMF cut its outlook for global economic growth in 2023, reflecting the continuing drag from the war in Ukraine as well as inflation pressures and the high interest rates

The global economy's new year (2023) is going to be 'tougher than the year we leave behind,' IMF's Georgieva said on Sunday (AFP)Premium
The global economy's new year (2023) is going to be 'tougher than the year we leave behind,' IMF's Georgieva said on Sunday (AFP)

The International Monetary Funds's (IMF) Managing Director Kristalina Georgieva has said that 2023 is going to be a ‘tougher’ year for global economy, tougher than than the one left behind in 2022. Georgieva said this during an interview on Sunday morning on the first day of the new year. 

The global economy's new year (2023) is going to be "tougher than the year we leave behind," IMF's Georgieva said on Sunday. She cited the simultaneous slow down of United States, China and European Unions' economy for the same. 

During the morning news program ‘Face the Nation’ on CBS, Georgieva said, "Why? Because the three main economies - the U.S., EU and China - are all slowing down simultaneously,"

In October, the IMF cut its outlook for global economic growth in 2023, reflecting the continuing drag from the war in Ukraine as well as inflation pressures and the high interest rates engineered by central banks like the U.S. Federal Reserve aimed at bringing those price pressures to heel.

Since then, China has scrapped its zero-COVID policy and embarked on a chaotic reopening of its economy, though consumers there remain wary as coronavirus cases surge. In his first public comments since the change in policy, President Xi Jinping on Saturday called in a New Year's address for more effort and unity as China enters a "new phase."

"For the first time in 40 years, China's growth in 2022 is likely to be at or below global growth," Georgieva said.

Moreover, a "bushfire" of expected COVID infections there in the months ahead are likely to further hit its economy this year and drag on both regional and global growth, said Georgieva, who traveled to China on IMF business late last month.

"I was in China last week, in a bubble in a city where there is zero COVID," she said. "But that is not going to last once people start traveling."

"For the next couple of months, it would be tough for China, and the impact on Chinese growth would be negative, the impact on the region will be negative, the impact on global growth will be negative," she said.

(With input from Reuters)

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Published: 01 Jan 2023, 10:43 PM IST
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