To recover fully from the shock caused by the new coronavirus, the IMF Managing Director Kristalina Georgieva said the global economy will take much longer than initially expected. Georgieva also stressed the danger of protectionism.
The Fund is likely to revise downward its forecast for a 3 percent contraction in GDP in 2020. Changes also likely in the Fund’s forecast of a partial recovery of 5.8 percent in 2021. Data from around the world was worse than expected, the head of the IMF said.
The world economy was thrown into the deepest recession since the 1930s Great Depression due to business closures and lockdowns to slow the spread of the virus, the Fund predicted in April. Georgieva said earlier this month that data reported since then points to “more bad news”.
The Fund’s new global projections is due to release in June. For finance ministers from the Group of Seven advanced economies, the global outlook remains a huge focus. After raising new lending commitments from its members, the Fund could provide grants through the end of the year to help the poorest countries cover their debt service payments to the Fund.
