The International Monetary Fund (IMF) on Tuesday adjusted up its 2020 global GDP growth projection but trimmed its forecast for next year's growth. According to the fund, the world's economy is now expected to shrink by 4.4% in 2020, compared to its previous estimate for a 5.2% contraction made in June. However, global GDP is now projected to grow by 5.2% in 2021, slower than the IMF's forecast of a 5.4% expansion made in June.
The upward revision was a result of better-than-expected growth in China and some advanced economies. The latest projection also assumes that local COVID-19 transmission will decrease across the globe by the end of 2022, with social distancing measures remaining in place into 2021. However, the IMF warned that the economy remained prone to setbacks, especially in some emerging markets and developing economies.
These countries are expected to see their economies fall by 3.3% this year, with places like India suffering a more than 10% contraction. European economies such as the UK, France, Italy, and Spain are expected to contract by about 10% this year, compared to the US expected economic contraction of 4.3%.
