The institution has revised its forecast slightly downward for next year in France. For its part, Russia is still avoiding recession, but China should see its activity slow down.
The International Monetary Fund (IMF) has revised down its growth forecast for 2023 slightly but expects major economic regions to avoid recession, according to data released at its spring meetings on Tuesday. The institution now anticipates global growth of 2.8% in 2023, down slightly from its previous estimate in January (-0.1 percentage point).
«We are facing an economy that continues to recover from the various shocks of recent years, in particular of course the pandemic but also the Russian invasion of Ukraine. And we see a gradual recovery“Explained the chief economist of the IMF, Pierre-Olivier Gourinchas, during a press conference. However, the situation could have been bleaker without the effects of the reopening in China and the acceleration of Indian growth which “will contribute half of global growth in 2023“, underlined Thursday the director general of the Fund, Kristalina Georgieva, during an interview with AFP.
For most countries, a return to normal is not yet in sight. In particular, inflation, which should remain high in 2023, around 7% worldwide, but above all because underlying inflation – excluding food and energy prices, which are by nature more fluctuating – remains misdirected. Added to this are the recent upheavals in the financial sector, particularly in the United States, after the bankruptcy of three regional banks, and in Switzerland, with the hasty takeover of Credit Suisse by its competitor UBS, against a background of rising interest rates. by central banks, precisely to fight inflation. “Risks once again weighed heavily on growth, largely due to the financial turmoil of recent weeks», underlined Pierre-Olivier Gourinchas.
Despite everything, the IMF is revising its growth forecasts for the United States upwards in 2023, to 1.6% (+0.2 points), as well as in 2024, to 1.1% (+0.1 point). They remain unchanged for France for 2023, at 0.7%, but are down slightly for 2024, at 1.3% (-0.3 points). The euro zone could do better than initially expected (+0.1 point) in 2023, at 0.8%, under the effect of higher growth in Spain and Italy. They are also improving in the United Kingdom, which should however end the year in recession, as expected since last October, but at a lower level than expected: -0.3% while the IMF still forecast -0.6% in January.
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Signs of weakness in China
Germany, on the other hand, is still flirting with recession: expected to show slight growth over the current year last January (+0.1%), the leading European economy is now expected to decline slightly (-0.1%). However, German industry should notably benefit from the economic recovery of its main customer, China, since the reopening of its economy, after the abandonment of its strict zero-Covid policy at the start of the year.
Chinese growth will once again play a driving role for global growth for 2023, at 5.2%, but will slow down from 2024, to 4.5%, one of its weakest growth rates in the last 30 years, outside of 2020 with the pandemic, and 2022 with the zero-Covid policy. Here again, the signs of weakness are present and encourage the IMF to be cautious in its forecasts. “There are concerns about the local real estate market, for example. But there are also more global risks, in particular that the war will once again push up the price of raw materials.“, explained Pierre-Olivier Gourinchas.
Russia, in particular, benefits from this commodity market, and, while six months ago, a severe recession was announced there, the economy should grow by 0.7% this year and 1.3% in 2024. , despite the increasingly severe sanctions imposed by Western economic powers. It is explained by “the trend observed in the second half of last year. But tougher trading conditions could lead to a significant decline in tax revenue and the current accountand cause a slowdown in the economy, a spokesperson for the Fund told AFP.
For 2024, the IMF does not change its forecast for global growth, at 3.0%. But without triumphalism, as Kristalina Georgieva recalled:We expect growth around 3% over the next five years, our weakest medium-term outlook since 1990».