The International Monetary Fund’s (IMF) has warned that trade tensions and resulting uncertainties could shave off 0.8 per cent of global Gross Domestic Product (GDP) by 2020.
Kristalina Georgieva, the Managing Director of the IMF, said this at the end of a roundtable discussion with Chinese Premier Li Keqiang and the heads of five other international organisations in Beijing.
The global economy is in a “synchronised slowdown,’’ Georgieva said.
Ninety per cent of the world’s GDP is slowing compared with 2018. In contrast, 75 per cent of the world’s GDP was increasing just two years ago, before the start of the U.S.-China trade war, Georgieva said.
While a variety of factors have contributed to the slowdown, key among them are the trade tensions and resulting uncertainties, she said.
The IMF expects China’s economy to grow 6.1 per cent this year and slip below the 6-per-cent mark in 2020.
The world’s second-largest economy slowed to 6 per cent growth in the third quarter of the year – its slowest pace in almost three decades – under pressure from rising debt and the trade war with the U.S.