IMF First Deputy Managing Director Jeffrey Okamoto said the Fund will raise its January global growth forecast to 5.5% in early April to reflect additional spending on US fiscal stimulus.
Speaking at the China Development Forum, Okamoto expressed concern about the growing gap between advanced economies and emerging markets, with some 90 million people falling below the extreme poverty line since the pandemic began.
Okamoto said China has already recovered to pre-pandemic levels, outstripping all major economies. At the same time, he said, outside of China, there are worrying signs of a widening gap between advanced economies and emerging markets.
According to him, the IMF predicts that total per capita income in emerging market and developing countries, excluding China, between 2020 and 2022 will be 22% lower than it would be without the pandemic, which will lead to the impoverishment of more people.
The overall outlook remains "exceptionally" vague, Okamoto said, adding that it is unclear how long the pandemic will last and that access to vaccines remains highly uneven in both advanced and emerging economies.
Okamoto noted that some countries have very little room to increase spending on the pandemic and mitigate its economic impact, which is especially noticeable in low-income, high-debt countries.
According to the Deputy Managing Director of the IMF, the current crisis could leave deep scars on the body of the global economy.
Recall that according to updated forecast UN, the global economy will grow 4.7% this year thanks to a stronger-than-expected recovery in the United States.