The Washington-based fund now projects that the Asia Pacific region’s GDP will total 4.6% this year, which is about 0.3 percentage points quicker than predicted in October and is mostly attributable to China’s openness.
According to the International Monetary Fund, China and India will together contribute for almost half of global growth this year, highlighting Asia’s growing influence on the global economy. The Washington-based fund now projects that the Asia Pacific region’s GDP will total 4.6% this year, which is about 0.3 percentage points quicker than predicted in October and is mostly attributable to China’s openness. According to the IMF, the area as a whole will contribute more than 70% of global growth this year.
According to Krishna Srinivasan, head of the IMF’s Asia and Pacific Department, the rebound in China is boosting activity across the region. The Chinese demand for investment products has “had the strongest spillovers to regional growth,” he said. But this time, we anticipate that China’s rising demand for consumer products would have the strongest spillover impact.
However, even at 5.2%, China’s growth would be far slower than its pre-Covid trend pace. Gita Gopinath, the first deputy managing director of the IMF, said earlier on Thursday that “we don’t have any Chinas anymore that are growing at very high rates.”
Therefore, Gopinath remarked on Bloomberg Television, “for the global economy as a whole, we don’t have very large engines of growth.” “If we don’t increase productivity, we’ll struggle with slow growth.” Meanwhile, according to Srinavasan, Asia must be on guard against concerns including persistent inflation, debt, and hazards in the financial and real estate sectors, just like the rest of the globe. Srinivasan advised policymakers to keep a watchful look out for signs of financial stress and create backup measures.