International Monetary Fund to launch financial assistance talks with Pakistan

Roman Schwartz
October 11, 2018

The IMF, in the WEO report, said inflation pressures in sub-Saharan Africa had broadly softened, with annual inflation projected to drop to 8.6 per cent in 2018 and 8.5 per cent in 2019, from 11 per cent in 2017.

With weakening growth and uncertainties over trade, smoothing the economic impact of structural adjustments and de-risking "is a very hard act of judgment that policymakers in China have to struggle with", Vitor Gaspar, director of the IMF's fiscal affairs department, told reporters at a separate briefing on its Fiscal Monitor, a report that tracks the state of countries' public finances.

Russian Federation was among the few energy-rich emerging market countries whose growth forecasts were bumped up.

Last month, the Swiss government, raised its GDP forecast for 2018 to 2.9% from 2.4% and, earlier this year, it was announced that Swiss exports had matched and surpassed their recent growth.

Their remarks come a day after the International Monetary Fund cut its forecast for annual global growth to 3.7 per cent, pointing to rising trade tensions.

"There is no denying that the susceptibility to large global shocks has risen", the IMF's top economist Maurice Obstfeld told reporters.

Lagarde told reporters Thursday at the annual meeting of the International Monetary Fund and World Bank (WB) in Bali, Indonesia, that so far there had been no "contagion" of major damage from penalty tariffs imposed by the two countries on each other's exports, but that they do risk hurting "innocent bystanders".

These policies have contributed to a slowdown in economic growth, which is happening just as trade tensions with the US are starting to bite.

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It also issued reports this week on government finance and financial stability that warn of the risks of disruptions to world trade.

Yi also said China would continue to open up its financial markets, including to foreign ratings agencies and bond investors, the attendees said.

Some energy-rich emerging market countries have fared better due to higher oil prices, with Saudi Arabia and Russian Federation seeing forecast upgrades.

The IMF projected that the nation's economy will grow from 1.9 percent in 2018 to 2.3 percent in 2019 adding that Nigeria, South Africa and Angola's slow growth economies are slowing the rest of Africa.

The Treasury's currency report will be released just a few weeks after the U.S. currency manipulation guidelines were included in the new United States-Mexico-Canada Agreement.

"US growth will decline once parts of its fiscal stimulus go into reverse", Mr Obstfeld said in a statement.

It predicted China's GDP growth at 6.6% in 2018-'19 and downgraded it to 6.2% for 2019-'20. Trump has justified the higher USA tariffs as a response to the trade imbalance between the two countries, and China has swiftly responded with higher levies on US imports.

The effects on the United States and China would be particularly severe, with 2019 GDP losses of more than 0.9% in the USA and 1.6% in China in 2019. The Trump administration has penalized almost half of all imports from China and has threatened more for the other half.

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