Coronavirus Impact: IMF Could Reduce Global Economic Growth Forecast

His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President, Prime Minister and Ruler of Dubai, today received, Kristalina Georgieva, Managing Director and Chairwoman of the International Monetary Fund, IMF, on the sidelines of the Global Women’s Forum Dubai, GWFD 2020, being on 16th and 17th February in Dubai. (WAM.AE)

Kristalina Georgieva, Managing Director – International Monetary Fund (IMF), has warned of serious effects on the world economy if the Wuhan coronavirus outbreak (COVID-19) is not contained soon.

Georgieva, who is in Dubai to attend the Global Women’s Forum Dubai 2020, said that it would affect global value chains and added that it was already adversely impacting tourism and travel.

The IMF official also hinted that they might have to look at reducing the global economic growth forecast by a few percentage points due to the economic impact of the Coronavirus.

“China today has a bigger share of the world economy than during the SARS outbreak. Now it’s 19 per cent. This is not good news for the world,” she added.

IMF’s earlier projections saw a rise of 3.3 per cent in 2020 from that of a 2.9 per cent last year. According to Georgieva, the impact of the coronavirus could mean a downward revision of .01 to .02 percentage points. However, the top IMF official also warned against jumping “prematurely into a conclusion.”

The virus has infected more than 69,000 people globally as of today with the number of deaths reaching more than 1,600. The outbreak had also prompted OPEC (Organization of the Petroleum Exporting Countries) and its allies to consider another 500,00 barrels per day (bpd) output cut.

Incidentally, IMF also recently released a foreboding report, warning that Arab monarchies of the Persian Gulf were facing a budget reckoning and risk squandering their US$2 trillion in financial wealth within 15 years as oil demand neared peak levels.

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