The Global Economic Outlook is Not as Dark as Expected

The global economic outlook is not as dark as it was forecast just three months ago. The International Monetary Fund spokesman shared this on Thursday. He cited better-than-expected data in China and other advanced economies.

However, Gerry Rice told reporters that the global overview remained challenging due to the coronavirus pandemic and its impact on various sectors of the economy.

The situation remains uncertain in many developing countries and emerging markets, including China. He noted that the IMF was concerned in addition to rising levels of debt.

The IMF will publish its World Economic Outlook, the WEO report, on October 13. 

In June, the International Monetary Fund cut its 2020 global production projections. Estimating that the world economy would contract by 4.9%, up from the 3% drop forecast in April.

Rice did not release new figures but said the latest data from China and other advanced economies came to be better than expected.

Recent data suggested that the outlook is somewhat less bleak than when the WEO underwent an update on June 24. Rice mentioned that parts of the global economy are beginning to change course.

Emerging Countries Face A Lot of Challenges

There are also signs that global trade is slowly beginning to recover after widespread lockdowns aimed at containing the spread of the virus.

Still, the spokesman highlighted that the economic outlook remains very challenging. Many developing countries face continued weak domestic demand, lower export demand, drop in payments, and slumps in the tourism sector.

Rice showed his concern that the crisis would reverse the progress in poverty reduction made in recent years. Besides, it could undo the progress made towards the Sustainable Development Goals. The spokesman referred to the United Nations’ ambitious goals five years ago to end poverty and inequality.