ISLAMABAD: China remains the largest engine of global economic growth, contributing one-third of the global economic growth, which is still dragged by the lingering scarring effect from the COVID-19 impacts, IMF economists said on Friday.
“China is projected to grow 5 percent this year. As a result, China is going to contribute roughly one third of the global GDP growth,” Steven Barnett, IMF Senior Representative for China, said at the launch of IMF World Economic Outlook 2023 in Beijing on Friday.
The global economy is resilient in 2023, but it still grapples with widespread scarring effect in post-pandemic recovery, Barnett said.
In its latest World Economic Outlook 2023 report, the IMF forecasted the global GDP to grow by 3 percent in 2023 and 2.9 percent in 2024.
The scarring effect is more prominent in low-income developing countries after the pandemic, with the least developed countries bearing the brunt. China ranks at the global average of the scar effect, Barnett said.
The inflation rates of many economies across the world, excluding China, have reached their highest levels in decades in 2022, according to IMF economists.
Most countries will have difficulty returning to their inflation targets by 2025, IMF forecasted.
China’s inflation is different from other countries as it has not experienced a significant increase, but has instead maintained at a relatively appropriate level, Barnett said.
Zhou Chengjun, director of the People’s Bank of China (PBC) Financial Research Institute, expressed cautious optimism about China’s macroeconomy at the launch event.
The demand for housing improvement and urbanization in China will provide a vast potential for the real estate market, and the key lies in adopting what kind of policies to meet these needs, Zhou said.
