Washington (EFE).- The world economy will grow 3% this year, according to the International Monetary Fund (IMF), which, although it improves its previous forecasts, believes that this progress is still “weak” and warns of global risks such as persistent inflation, future vulnerabilities in the financial system or that China grows less than expected.
In the review report on its world economic prospects, published this Tuesday, the IMF has improved its forecast for the global economy by two tenths compared to April for 2023, while for 2024 it maintains the same estimate and also calculates a growth of the world gross domestic product (GDP) of 3%.
The Fund celebrates the end of the covid-19 pandemic and the recovery of supply chains, and also appreciates that issues such as the agreement on the US debt ceiling or the banking crises in the United States and Switzerland were resolved without affecting the financial system in general.
But he warns that the “forces” that “hampered” growth in 2022 “persist” this year as well, especially inflation.
Despite lower energy and food prices, subjacent inflation -which excludes these two groups- remains high and forces central banks to maintain their restrictive monetary policy.
For Latin America due to the push of Mexico and Brazil
The IMF revised upwards its growth forecasts for Latin America and the Caribbean thanks to a higher-than-expected progress in the largest economies in the region, Brazil and Mexico.
In the review of its world economic forecasts, published this Tuesday, the IMF believes that Latin America will grow 1.9% in 2023, three tenths above what it predicted in April, and for 2024 it maintained its forecast of 2.2% for the region as a whole.
Latin American growth will be this year and the next well below that of 2021, when it picked up to 7%, and 3.9% in 2022, when it continued its recovery after the pandemic.
As the Fund’s Research Director, Pierre-Olivier Gourinchas, explained in an interview with EFE, domestic demand in the region continues to be “relatively strong”, although it is expected to weaken this year compared to 2022.
He recalled that this region was the first to apply a restrictive monetary policy to combat inflation, its central banks reacted long before the United States Federal Reserve or the European Central Bank did, and this meant that they felt the effects of rate hikes on their economy earlier.
Improves economic growth for Spain
The International Monetary Fund raised its economic growth forecast for Spain this year by one point, to 2.5%, and although it did not want to speculate on the effects that the result of the general elections may have on the economy, it stressed the importance of political stability.
“In general, instability is never good for the economy, but I think we have to wait and see how the process ends and where the Spanish people want to go with the results of these elections,” said the director of the IMF’s Research Department, Pierre Olivier Gourinchas, in an interview with EFE on the occasion of the review of world economic forecasts.
The conservative Popular Party, led by Alberto Núñez Feijóo, was the winner of the elections on Sunday, with 136 seats, but did not reach a sufficient majority to govern, established at 176 deputies, not even adding the 33 of the far-right formation Vox, a bitter victory that opens the way for the socialists of the acting president, Pedro Sánchez, to try to negotiate a new coalition government.
In its new economic projections, the IMF, in addition to the aforementioned improvement to 2.5% by 2023 in Spain, maintained its forecast for 2024 at 2%.
In any case, Gourinchas highlighted the “strong resilience” that the Spanish economy has shown, which together with the rebound in tourism has allowed this improvement in forecasts, adding that there is “even better” news with the drop in inflation in Spain.