IMF, "Due to COVID-19 Impact, China's Economic Growth Rate Estimated at 5.6% This Year... Forecast Down by 0.4%p"

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Hyunwoo Lee] Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF), announced that the estimated economic growth rate of China for this year has been revised down from 6.0% to 5.6% due to the spread of the novel coronavirus disease (COVID-19).

Georgieva attended the G20 Finance Ministers meeting held in Riyadh, Saudi Arabia, and stated, "According to our baseline scenario regarding the spread of COVID-19, China's economic growth rate this year is estimated at 5.6%. Under this scenario, the Chinese economy is expected to normalize in the second quarter of this year, and the impact on the global economy will be relatively limited and short-term."

She added, "We are also considering a more severe scenario where the virus spreads internationally for a longer period. In that case, global economic growth will contract further," indicating that if COVID-19 prolongs, the growth forecasts for both China and the global economy could be further downgraded. The IMF had previously projected China's economic growth rate at 6.0% in its monthly report last month.

Georgieva also announced a downward revision of the global growth forecast. She explained, "In January, we projected the global economic growth rate for this year at 3.3%, which is 0.4 percentage points higher than last year. Due to the spread of COVID-19, we are lowering this forecast by about 0.1 percentage points." She added, "The impact on the global economy will vary depending on how quickly the spread of COVID-19 is controlled and how swiftly China and the affected economies return to normal."

During the panel discussion, she predicted that the global and Chinese economic growth rates will show a 'V'-shaped graph, sharply falling due to the spread of COVID-19 and then quickly recovering.