NEW DELHI: It is going to be a tough 2022 — and possibly an even tougher 2023, with increased risk of recession, the IMF chief has warned. She urged G20 countries to adopt policies to navigate the sea of troubles.
“The human tragedy of the war in Ukraine has worsened. . . slowing growth and exacerbating a cost of living crisis that affects hundreds of millions of people — and especially poor people who cannot afford to feed their families. And it’s only getting worse,” said IMF’s managing director, Kristalina Georgieva.
She said recent indicators imply a weak second quarter and the IMF will be projecting a further downgrade to global growth for both 2022 and 2023 in its ‘World Economic Outlook Update’ later this month.
“Indeed, the outlook remains extremely uncertain. Think of how further disruption in the natural gas supply to Europe could plunge many economies into recession and trigger a global energy crisis. This is just one of the factors that could worsen an already difficult situation,” said Georgieva.
She also said as an immediate step, countries must reverse recently imposed restrictions on food exports as such restrictions are harmful and ineffective in stabilising domestic prices.
She called for further measures to strengthen supply chains and to help vulnerable countries adapt food production to cope with climate change. Calling for a fresh impetus for global cooperation led by the G20, the IMF MD said to avoid potential crises and boost growth and productivity, more coordinated international action is urgently needed.
“The key is to build on recent progress in areas ranging from taxation and trade to pandemic preparedness and climate change. The G20’s new $1. 1-billion fund for pandemic prevention and preparedness shows what is possible, as do recent successes at the World Trade Organization,” said Georgieva.