September/October CTIP Trade and Investment Link 19
World bank and IMF Assessment of the World’s Economic Outlook of 2020
energy use and shift to cleaner alternatives—and, moreover, it generates revenue that can be used in part to support the most vulnerable," write the IMF's Vitor Gaspar, Paulo Medas, John Ralyea, and Elif Ture COVID-19 AND THE GLOBAL ECONOMY
OCTOBER 2020 WORLD ECONOMIC OUTLOOK In our latest World Economic Outlook, we continue to project a deep recession in 2020. Global growth is projected to be 4.4 percent, an upward revision of 0.8 percentage points compared to our June update. This upgrade owes to somewhat less dire outcomes in the second quarter, as well as signs of a stronger recovery in the third quarter, offset partly by downgrades in some emerging and developing economies. In 2021 growth is projected to rebound to 5.2 percent, 0.2 percentage points below our June projection. "If medical solutions can be available faster and more widely relative to our baseline, it could lead to a cumulative increase in global income of almost $9 trillion by end 2025, raising incomes in all countries and reducing income divergence," said IMF Chief Economist Gita Gopinath at the press conference. OCTOBER 2020 GLOBAL FINANCIAL STABILITY REPORT In our latest Global Financial Stability Report, we found that significant improvement in financial conditions has helped maintain the flow of credit to the economy, but the economic outlook remains highly uncertain. A disconnect persists, for example, between financial markets—where there have been rising stock market valuations (despite the recent repricing)— and the weak economic activity and uncertain outlook. This gap can gradually narrow if the economy recovers swiftly. But if the recovery is delayed, for example because it may take longer to get the virus under control, the investor optimism may wane. Financial Counsellor and Director of the IMF’s Monetary and Capital Markets Department Tobias Adrian. OCTOBER 2020 FISCAL MONITOR
We just published the October 2020 Fiscal Monitor, which examines countries’ experiences managing the crisis and discusses what governments can do in the different phases of the pandemic to save lives, reduce the impact of the recession, and revive growth and job creation. "As economies begin to recover, governments should seize this moment to move away from the pre-crisis growth model and accelerate the transition to a low-carbon and digital economy. Carbon pricing should be a key feature of this transition, because it encourages people to reduce
The world economy has been hit by the biggest shock in the postwar era. Governments have responded with unprecedented measures to protect lives and livelihoods. Are we out of the woods yet? Moderated by Geoff Cutmore, Anchor, CNBC, this televised debate featured Kristalina Georgieva, Managing Director, IMF; Christine Lagarde, President, European Central Bank; Sri Mulyani Indrawati, Finance Minister, Indonesia; and Ngozi Okonjo-Iweala, Board Chair at GAVI / AU Special Envoy on response to COVID-19. European Central Bank President Christine Lagarde and IMF European Department Director Alfred Kammer also discussed the post-pandemic landscape and challenges for policy makers in Europe. Lagarde said that we need to address the pandemic and support the recovery by focusing on three kinds of policies: a sound regulatory environment, targeted public investment that encourages private investment, and both education and training. She also noted that citizens are going to drive change moving forward, and that 75 percent of the population in the Euro area expects their government to put environmental protection and climate change at the top of their priorities. Kristalina Georgieva, Managing Director, IMF, who said that governments need to focus on three priorities: improve health systems, avoid withdrawing stimulus support prematurely, and direct stimulus funding towards transforming the economy. Mark Carney, Finance Adviser to the Prime Minister for COP 26 and UN Special Envoy for Climate Action and Finance, also participated in the event, noting that climate change is now center stage for the private sector, financial sector and the real economy. Laurence Fink, Chairman and Chief Executive Officer, BlackRock, Inc., said that as we move forward to a more digital society, the need for hydrocarbons is going to reduce, and that we should provide digital access to every household in the world, which would lead to a better quality of life and a better existence. Vera Daves de Sousa, Finance Minister, Angola, talked about her strategy for the next 12 months: we need to make sure we survive, that we preserve lives, that our health system does not collapse, and that our debt remains sustainable. -oooOOOooo-