ReutersThe International Monetary Fund (IMF) Tuesday pitched for deeper structural reforms and orderly deleveraging to mitigate long-term effects of the impending global slowdown.
In a detailed presentation on the world economy at the ongoing G20 Sherpa meeting in Udaipur, seen by ET, the IMF cautioned that high-frequency indicators point to a weakening global growth momentum in the fourth quarter and sought measures to support growth.
The multilateral lender called for tightening the fiscal policy to address elevated debt levels and surging inflation.
It stressed on the need for orderly deleveraging and sound debt restructuring frameworks to mitigate risks, while flagging the elevated risk of high sovereign debt.
"Public and private debt overhang will require deleveraging," it said.
"Tighten fiscal policy to address elevated debt and, where inflation is elevated, to avoid working against monetary policy," the presentation highlighted, adding that the fight against inflation needs to continue and where needed countries should use macroprudential policy to avoid risk from materializing.
The IMF has projected the Indian economy to grow by 6.8% in the current fiscal year (FY23) and 6.1% in the next fiscal year.
The world economic growth is expected to slow to 3.2% in 2022 and 2.7% in 2023.
Forecasts imply significant medium-term output losses for all world regions, particularly among emerging market and developing economies, it said, while pointing out that the downside risks to the outlook were prevalent.
China, according to the presentation, was witnessing stalled recovery in mobility and supply chains. Its economic growth is forecast to slow to 3.2% in 2022, from 8.1% in 2021.
"While transport costs are easing, indicators of new export orders point to weakness," it said, while observing that the trade-related uncertainty was spiking and calling for supporting growth in diversified global trade. "The number of trade restrictions were on the rise, especially in high-tech and energy sectors," the presentation pointed out.
The IMF suggested targeted temporary measures to support the most vulnerable in view of the slowing global economy and high inflation.
It stressed on urgently implementing and broadening the G20 Common Framework and supporting growth in diversified global trade.
The multilateral body also emphasised on the need to strengthen global cooperation to mitigate fragmentation risks.
In a detailed presentation on the world economy at the ongoing G20 Sherpa meeting in Udaipur, seen by ET, the IMF cautioned that high-frequency indicators point to a weakening global growth momentum in the fourth quarter and sought measures to support growth.
The multilateral lender called for tightening the fiscal policy to address elevated debt levels and surging inflation.
It stressed on the need for orderly deleveraging and sound debt restructuring frameworks to mitigate risks, while flagging the elevated risk of high sovereign debt.
"Public and private debt overhang will require deleveraging," it said.
"Tighten fiscal policy to address elevated debt and, where inflation is elevated, to avoid working against monetary policy," the presentation highlighted, adding that the fight against inflation needs to continue and where needed countries should use macroprudential policy to avoid risk from materializing.
The IMF has projected the Indian economy to grow by 6.8% in the current fiscal year (FY23) and 6.1% in the next fiscal year.
The world economic growth is expected to slow to 3.2% in 2022 and 2.7% in 2023.
Forecasts imply significant medium-term output losses for all world regions, particularly among emerging market and developing economies, it said, while pointing out that the downside risks to the outlook were prevalent.
China, according to the presentation, was witnessing stalled recovery in mobility and supply chains. Its economic growth is forecast to slow to 3.2% in 2022, from 8.1% in 2021.
"While transport costs are easing, indicators of new export orders point to weakness," it said, while observing that the trade-related uncertainty was spiking and calling for supporting growth in diversified global trade. "The number of trade restrictions were on the rise, especially in high-tech and energy sectors," the presentation pointed out.
The IMF suggested targeted temporary measures to support the most vulnerable in view of the slowing global economy and high inflation.
It stressed on urgently implementing and broadening the G20 Common Framework and supporting growth in diversified global trade.
The multilateral body also emphasised on the need to strengthen global cooperation to mitigate fragmentation risks.
( Originally published on Dec 06, 2022 )
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