In its October World Economic Outlook report, the International Monetary Fund (IMF) has lowered its growth estimate for the world economy to 5.9% from 6.0% in its July estimate. For 2022, however, the IMF has kept its global growth projection unchanged at 4.9%.
In its report, the IMF notes that while growth in advanced economies is largely expected to return to the pre-pandemic trend in 2022, it expects emerging and developing economies’ (excluding China) growth to remain 5.5% below trend in 2024. The Washington-based institution specifically details downgrades in the outlook for five Southeast Asian countries (Indonesia, Malaysia, the Philippines, Thailand and Vietnam). It cut the growth outlook for 2021 to 2.9% from 4.3% in its July estimate.
However, as a result of supply chain disruptions, the IMF also lowered some growth projections for advanced nations. For example, it now expects the US economy to grow by 6.0% this year compared to the 7.0% it previously predicted. However, for 2022, the IMF has revised upwards its growth expectation for this economy, now expecting GDP growth of 5.2% (4.9% in its previous estimate in July). The IMF also lowered the growth outlook for 2021 for Germany, Spain, Japan, the UK and Canada. Finally, for China’s economy, the organisation now projects growth of 8.0% in 2021, down slightly from 8.1% in its July estimate.
As for Spain, the IMF has lowered Spain’s GDP growth in 2021 to 5.7% (6.2% in its previous estimate in July). This growth, which is higher than the 5% expected on average for the Eurozone’s GDP, is nevertheless lower than the 5.9% estimated global growth. Moreover, the Spanish economy will grow less than that of the US (6.0%); that of France (6.3%); Italy (5.8%); and the UK (6.8%). The IMF’s new forecast is significantly lower than that projected by the Spanish Government for this year, which is still 6.5%. For 2022 the IMF expects Spain’s economy to grow by 6.4% (5.8% in its previous estimate) compared with the 7.0% estimated by the Government. Meanwhile, the organisation expects Spain’s unemployment rate to be 15.4% in 2021 and 14.8% in 2022, in both cases the highest in the Eurozone.