The days of the International Monetary Fund (IMF) regularly downgrading global economic growth are almost over, according to Kristalina Georgieva, the organization’s managing director. At the World Economic Forum in Davos, Switzerland, the IMF chief told CNBC on Tuesday (January 17, 2023), “I don’t see a downgrade now, but growth in 2023 will slow down.” “The good news though is that we expect growth to bottom out this year and 2024 to be a year in which we finally see the world economy on an upside,” she said. Read: Economic woes, war, climate change on tap for Davos meeting Since October 2021, the IMF has revised its growth projection three times. Georgieva told CNBC that although inflation is dropping, it is “still quite high,” and that we are “not quite there yet” in terms of central banks possibly lowering interest rates. She added that central banks must be careful “not to remove their foot off the brake too early”. The US inflation rate plummeted last week to its lowest level since October 2021, while inflation in the euro zone fell in December for a second consecutive month. Read: Europe’s inflation slows again but cost of living still high Georgieva also spoke on China, reiterating IMF predictions that the country’s GDP will expand but that it won’t contribute as much to global growth as in the past. China will achieve the IMF’s projected growth of 4.4 percent by the end of the year if it continues with its present Covid-19 reform plan, she said.

The head of the International Monetary Fund warned Thursday that Russia's war against Ukraine was weakening the economic prospects for most of the world’s countries and called high inflation “a clear and present danger’’ to the global economy. IMF Managing Director Kristalina Georgieva said the consequences of Russia's invasion were contributing to economic downgrades for 143 countries, although most of them should continue to grow. The war has disrupted global trade in energy and grain and is threatening to cause food shortages in Africa and Middle East. Georgieva made her comments in a speech on the eve of next week’s spring meetings of the IMF and the World Bank in Washington. An unexpectedly strong recovery from 2020’s pandemic recession has caught businesses by surprise, leaving factories, ports and freight yards unable to keep up with robust customer demand and forcing prices higher. Also read: Sri Lanka halts debt repayment pending IMF bailout plan Chronically high inflation, which is forcing the world’s central banks to raise interest rates and likely slow economic growth in the process, amounts to “a massive setback for the global recovery,’’ Georgieva said. Georgieva also warned of “the fragmentation of the world economy into geopolitical blocs," with the West imposing far-reaching sanctions on Russia and China expressing support for the autocratic Russian regime of President Vladimir Putin. “In a world where war in Europe creates hunger in Africa; where a pandemic can circle the globe in days and reverberate for years; where emissions anywhere mean rising sea levels almost everywhere — the threat to our collective prosperity from a breakdown in global cooperation cannot be overstated,” Georgieva said. Before the war, Russia and Ukraine had supplied 28% of global wheat exports. And Russia and Belarus accounted for 40% of exports of the fertilizer potash. “Now,’’ Georgieva said, “grain and corn prices are soaring, and leaders across Africa and the Middle East are telling me that supplies are running low. Food insecurity is a grave concern. Also read: Bangladesh economy to grow 6.6 per cent FY22, as Covid-19 transmission decreases: IMF “We must act now with a multilateral initiative to bolster food security. The alternative is dire: More hunger, more poverty and more social unrest — especially for countries that have struggled to escape fragility and conflict for many years.’’ Georgieva called on the world to support the Ukrainians and noted that the IMF had delivered $1.4 billion in emergency financing to help Ukraine meet its immediate spending needs. The IMF is also offering assistance to Ukraine’s neighbors, including Moldova, which has accepted more than 400,000 war refugees.