IMF Managing Director: "Eurozone Economic Growth Forecast Downgraded Due to Omicron Spread"

Kristalina Georgieva, IMF Managing Director. (Photo by CNBC)

[Asia Economy Reporter Yujin Cho] Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF), stated that the economic growth forecast for the Eurozone (19 countries using the euro) next year could be slightly downgraded due to the spread of the Omicron variant and high inflation.

On the 6th (local time), in an interview with CNBC, Managing Director Georgieva expressed concern that social restrictions are being reintroduced in some areas due to the Omicron variant amid ongoing supply chain disruptions and strong energy prices.

In its economic outlook released last month, the IMF projected the Eurozone's economic growth rate for next year at 4.3%. Managing Director Georgieva said that the growth forecast could be slightly revised downward in a new report to be released next month.

Georgieva emphasized that even before the emergence of Omicron, the COVID-19 pandemic remains the greatest threat to the global economy, noting that although progress is being made in vaccination rates, it is still insufficient.

Regarding restrictions on unvaccinated individuals introduced by some Eurozone countries, she pointed out a clear correlation between vaccination rates and economic recovery, stating that "vaccination for everyone in all regions" is necessary.

Managing Director Georgieva also added that it is important to monitor wage increase trends, which are a key factor influencing high Eurozone prices and inflation. She explained, "It will be necessary to closely monitor the wage negotiation situations of companies that were postponed during the pandemic."

According to Eurostat, the statistical office of the European Union (EU), consumer prices in the Eurozone in November rose 4.9% compared to a year earlier, marking the highest level since statistics began in 1997.