The head of the IMF Georgieva predicted an imminent “boom” due to the vulnerability of the global economy
The vulnerability of the global economy could lead to an imminent “boom”. This forecast was made by IMF Managing Director Kristalina Georgieva during a conversation with a journalist on the eve of the annual spring meetings of the IMF and the World Bank. The recording of the conversation is available at YouTube.
“It just can’t be that interest rates have risen this much after being low for so long and there would be no vulnerabilities. Something has to make the boom,” warned the head of the IMF.
According to her, the global economy is not approaching a repeat of the 2008 global financial crisis, and there are problems in the banking sector in the US and Switzerland. She explained that the situation in 2008 was due to the fact that a large number of financial institutions held overvalued assets on their balance sheets, while now the financial situation has become much “cleaner”.
In addition, she pointed to possible negative consequences due to the Ukrainian conflict and the growing escalation between the US and China. In her opinion, the cooling of the West’s relations with other global countries can lead to trade losses from $200 billion to $7 trillion, which is approximately equal to 0.2-7 percent of world GDP.
Earlier, Georgieva announced the weakest forecast for global economic growth over the next five years in more than three decades. Not only is this growth forecast the lowest since 1990, but it is also below the five-year average of 3.8 percent over the past two decades.
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