IMF warns of 'diverging recoveries' post-pandemic

[WASHINGTON] The IMF on Thursday warned of "diverging recoveries" among global economies as they struggle with the ongoing Covid-19 pandemic, even as vaccines are approved.

"We are seeing overall improvement in the global economy, but with many countries and people, too many, still left behind," the Washington-based crisis lender's spokesman Gerry Rice said.

"We have described it in the past as diverging recoveries and countries being at very different levels, and I think we're still seeing that broad picture." The International Monetary Fund will on April 6 release new growth forecasts for the global economy, after in January predicting it would see a strong rebound of 5.5 per cent this year after contracting 3.5 per cent in 2020 as Covid-19 sealed borders and disrupted businesses.

However the lender warned the outlook is beset by "extraordinary uncertainty," and said the global economy was set to lose US$22 trillion from 2020 to 2025 due to the pandemic.

The fund this month said the US$1.9 trillion relief measure US President Joe Biden signed will boost growth both in the world's largest economy and internationally, and expand US GDP by five to six percent over three years.

It will also increase demand, helping other countries sell more products to US consumers.

Mr Biden is expected to unveil a measure to improve US infrastructure that could cost as much as US$3 trillion but potentially also increase the country's high debt and deficit levels.

Mr Rice declined to comment on the proposal.

AFP

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