The International Monetary Fund is warning that slower global growth ahead could increase support for anti-globalization movements, like BREXIT in the U.K. and the U.S. presidential candidacy of Republican Donald Trump.
CCTV America’s Jessica Stone reports.
IMF forecasts slightly slower global growthThe International Monetary Fund is warning that slower global growth ahead could increase support for anti-globalization movements, like BREXIT in the U.K. and the U.S. presidential candidacy of Republican Donald Trump. CCTV America's Jessica Stone reports.
The IMF revised its world economic outlook down to 3.1 percent for this year and 3.4 percent in 2017.
The fund said its projections remains “tilted to the downside.” Among the contributing factors: the U.K.’s vote to exit Europe as well as “…a sharp hike in trade barriers” and “a bumpy transition in China.”
The IMF remains bullish on what it calls “emerging Asia” and India. It also says it’s less concerned about China’s near-term prospects because of stimulus measures taken by the government, including an expansion in credit and continued support for its debt-ridden steel and coal industries.
Some western analysts have warned the credit boom could turn into a credit bubble unless China also accelerates its economic reforms. But a Xinhua commentary titled “No need to exaggerate China’s economic headwinds,” China’s state-run news agency said the country’s debt levels were “still manageable.”
A view apparently shared by the IMF—on Oct. 1 it went ahead with its decision to add the renminbi to its exclusive basket of five international currencies that the fund holds in reserve. The move was widely interpreted in the western media as a vote of confidence in China’s economic restructuring.
Acknowledging “major challenges ahead” for China’s economic reboot, IMF Research Director, Maurice Obstfeld also expressed confidence in current forecasts for China’s growth. “We view the near-term prospects in China as favorable,” he said.