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Third of the world will experience recession this year, IMF head warns

According to the International Monetary Fund’s (IMF) chief, this year will see a third of the world’s economy in a recession.

As the economies of the US, EU, and China slump, 2023 will be “tougher” than last year, according to Kristalina Georgieva.

The global economy is currently being weighed down by the conflict in Ukraine, rising costs, higher interest rates, and the expansion of Covid in China.

The IMF revised down its forecast for 2023 global economic growth in October.

On the CBS television show Face the Nation, Ms. Georgieva stated that “we predict one third of the world economy to be in recession.”

For hundreds of millions of people, it would feel like a recession even in nations that are not experiencing one, she continued.

In October, the IMF revised down its forecast for global economic growth in 2023 as a result of the conflict in Ukraine and higher interest rates as central banks around the world work to contain inflation.

Since that time, despite the massive spread of coronavirus infections in the nation, China has abandoned its “zero Covid” policy and begun to reopen its economy.

China, the second-largest economy in the world, would likely have a difficult beginning to 2023, Ms. Georgieva predicted.

She predicted that the coming months would be difficult for China, which would have a detrimental effect on the country’s progress as well as that of the region and the entire world.

190 nations make up the IMF, an international organization. They cooperate in an effort to stabilize the world economy. Being a system for early economic warning is one of its most important functions.

Data that was made public over the weekend indicated that the Chinese economy will be weak towards the end of 2022.

The official purchasing managers’ index (PMI) for December revealed that as coronavirus infections spread throughout the nation’s factories, factory activity in China declined for the third consecutive month and at the highest rate in over three years.

In the same month, housing prices in 100 cities decreased for the sixth consecutive month, according to a survey conducted by China Index Academy, one of the biggest independent real estate research businesses in the nation.

President Xi Jinping called for more effort and cooperation as China enters a “new chapter” on Saturday in his first public remarks since the policy adjustment.

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