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World GDP would grow 5.9% in 2021 and 4.9% in 2022: IMF

World GDP would grow 5.9% in 2021 and 4.9% in 2022, according to projections from the International Monetary Fund (IMF) released on Tuesday.

The new estimates imply a slight downward adjustment for the economic expansion expected in 2021.

Before, in 2020, world GDP registered a fall of 3.1 percent.

The agency assured that the global economic recovery has lost momentum due to the impact of the Delta variant of the virus, persistent disruptions in the production chains and rising inflation in several countries.

In addition, according to a summary on the matter by Intercam Banco, the IMF considered that the risks to growth are biased downward and those of inflation are upward, which makes decisions at the economic policy level more complicated.

The IMF estimates a growth of 5.9% in global GDP during 2021, a figure 0.1% lower compared to its projections for July.

For 2022, the projections were unchanged and remain at 4.9% per year.

World GDP

The biggest downward adjustments occurred in advanced economies, especially the United States, which saw a cut of one percentage point in its growth estimates for 2021 (6% vs. 7% previously) due to disruptions in production chains.

Also Japan (-0.4pp to 2.4%), United Kingdom (-0.2pp to 6.8%) and Canada (-0.6pp to 5.7%) saw downward revisions for 2021, while Europe was the only one to see a revision to the hike for the year (+ 0.4pp to 5 percent).

In aggregate, the block of advanced economies saw a 0.4 percentage point cut in its growth estimates for this year (5.2%), but most will see higher growth in 2022 (+ 0.1pp, 4.5 percent).

Another group of countries that suffered important downward revisions was that of low-income economies (-0.9pp to 3% in 2021; -0.2pp to 5.3% in 2022), due to a deterioration in conditions due to the pandemic; while some emerging economies saw upward revisions in their growth expectations this year, particularly commodity exporters such as Russia (+ 0.3pp to 4.7% 2021), Saudi Arabia (+ 0.4pp to 2.8%) and South Africa (+ 1pp at 5 percent).

In the case of China, growth in both 2021 (8% vs 8.1% prev.) and 2022 (5.6% vs 5.7% prev.) was revised slightly downwards, with similar actions for the estimates of Brazil (- 0.1pp to 52% 2021; -0.4pp to 1.5% 2022) and Mexico (-0.1pp to 6.2% 2021; -0.2pp to 4% 2022).

 

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