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The president of the IMF has predicted that a third of the world's economy will experience a recession this year and warned that 2023 will be a "tougher" year than the previous 12 months.
According to IMF managing director Kristalina Georgieva, the US, the EU, and China are all slowing down at the same time.
In an interview with the US TV network CBS that aired on Sunday, Georgieva stated that "we estimate one-third of the world economy to be in recession" and added that "half of the European Union will be in a recession" this year.
In October, the IMF revised its projection for global economic growth through 2023, citing the ongoing adverse effects of the Ukraine conflict, inflationary pressures, and increases in key central banks' interest rates.
In the short term, Georgieva added, China would suffer a new economic blow due to the Covid-19 virus' quick proliferation in the country now that the government has abandoned its strict containment policy.
She predicted that the coming months would be difficult for China, which would have a detrimental effect on the country's progress and that of the region and the entire world.
According to Georgieva, China's annual growth is expected to be at or below global growth for the first time in 40 years, which means it may actually slow down global economic activity rather than boost it. She said, "Never has that happened before."
Her remarks imply that the IMF, which typically releases new projections during the World Growth Forum in Davos, Switzerland, which takes place later this month, is likely to slash its economic forecasts for 2023 again.
The United States is expected to avoid the worst of the recession.
