The IMF expects the global economy to shrink by 4.9 percent this year, downgrading its economic outlook because of larger-than-expected economic fallout from measures introduced to contain the Covid-19 pandemic. The only major economy projected to record economic growth this year is China.
The IMF projects that global GDP will decline by 4.9 percent this year, down from a projected 3 percent decline in its April outlook. The global economy is expected to grow by 5.4 percent next year under a baseline scenario that assumes a limited resurgence of coronavirus cases in most countries.
IMF forecasts are widely used in modelling for key oil demand projections, including those of the IEA. The newly downgraded forecast suggests the global economy next year would be 6.5 percent smaller than the IMF was projecting before the pandemic.
China, which suffered the first coronavirus cases and which became the first country to implement and then relax curbs on travel and industrial activity, is projected to grow at a 1 percent rate this year and 8.2 percent next year, both lower than the IMF projected three months ago.
Mexico and Brazil, where the number of infections is still rising fast, are expected to decline by 11 percent and 9.1 percent, respectively. Saudi Arabia's economy is projected to decline by 6.8 percent this year, more than the 2.3 percent decline the IMF forecast in April.
