New International Monetary Fund (IMF) chief Kristalina Georgieva made a statement that the largest emerging market economies like India are suffering the most from GDP slowdown and experiencing even “more pronounced” effect of the global warning that the global economy is witnessing “synchronised slowdown” which will lead to slower growth for 90% of the world this year.
According to her, this across the globe slowdown will result in a growth rate that will be the lowest since the turn of this decade.
The World Economic Outlook is bound to be released next week and that will show downward revisions for 2019 and 2020.
“In 2019, we expect slower growth in nearly 90% of the world. The global economy is now in a synchronized slowdown,” Ms. Georgieva said in her curtain raiser speech for the IMF.
Some positive news during this downward spiral of economy came out when it was declared that close to 40 emerging market and developing economies are forecast to have real GDP growth rates above 5% — including 19 in sub-Saharan Africa, the IMF chief said. In superpower countries like the U.S. and Germany, unemployment is at historic lows.
Yet, across advanced economies including the U.S., Japan and especially the Euro area, there was a softening of economic activity, she said.
The RBI lowered India’s GDP growth estimate for the year to 6.1% from the earlier 6.9% due to the current phase of economic slowdown.
IMF Chief called for using monetary policy wisely and enhancing financial stability.
“Now is the time for countries with room in their budgets to deploy — or get ready to deploy — fiscal firepower. In fact, low interest rates may give some policymakers additional money to spend,” she said.