IMF believes resilient China to help power global economic growth in 2017

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International Monetary Fund Managing Director Christine Lagarde (L) and World Bank President Jim Yong Kim (R) share a stage at the Parliamentary Town Hall at the IMF/World Bank Spring Meetings at the World Bank. The IMF said a resilient Chinese economy will help support global economic growth in 2017. Photo: AFP

Published: 12:37am, 19 Apr 2017

A resilient China, rising commodity prices and sturdy financial markets are offering a sunnier outlook for the global economy and helping dispel the gloom that has lingered since the Great Recession ended.

That’s the picture sketched Tuesday by the International Monetary Fund, which predicts that the world economy will grow 3.5 per cent this year, up from 3.1 per cent in 2016. The IMF’s latest outlook for 2017 is a slight upgrade from the 3.4 per cent global growth it had forecast in January.

The IMF expects the US economy to grow 2.3 per cent, up from 1.6 per cent in 2016; the 19-country eurozone to expand 1.7 per cent, the same as last year; Japan to grow 1.2 per cent, up from 1 per cent; and China to expand 6.6 per cent, down from 6.7 per cent in 2016.

“Momentum in the global economy has been building since the middle of last year,” the IMF’s chief economist, Maurice Obstfeld, told reporters. But, he added, “We cannot be sure we are out of the woods.”

Maurice Obstfeld, chief economist at the International Monetary Fund (IMF), said in a briefing momentum in the global economy has been building since 2016. Photo: Xinhua

The monetary fund’s latest outlook for the economy comes in advance of spring meetings in Washington this week of the IMF, the World Bank and the Group of 20 major economies. The meetings come against the backdrop of a gradually strengthening international picture, especially in many emerging economies, despite resistance to free trade and political unrest in some countries.