The head of the IMF gave an economic forecast for 2023

International Monetary Fund (IMF) Managing Director Kristalina Georgieva said the organization’s forecast for global economic growth in 2023 is deteriorating, Reuters writes. There is a growing possibility that global GDP growth will fall below 2 percent next year, she said.

The deterioration in the assessment was affected by the ongoing hostilities in Ukraine and the simultaneous slowdowns in the economies of Europe, China and the United States. Georgieva expressed particular concern about the slowdown in China’s economic growth, which is a powerful engine of global growth.

According to the head of the IMF, the fund will present an updated economic forecast in January. She noted that the picture “recently worsened due to what is observed in the mood of consumers and investors.” The organization published the previous forecast for the dynamics of global GDP in 2023 in October – then the estimate worsened to 2.7 percent from 2.9 percent in July.

Then the IMF explained the deterioration in the forecast by the Ukrainian conflict, high energy and food prices, as well as inflation and a sharp increase in interest rates in different countries. The Fund estimated the probability that global GDP growth in 2023 will be less than two percent, at 25 percent. The IMF’s expectations have been so pessimistic only five times since 1970. In addition, the fund estimated at 10 percent the likelihood that the global economy will enter a recession.

Speaking at the G20 summit in November, Georgieva said the Ukraine conflict is the “most important negative factor” for the global economy this year and is likely to remain so in 2023.