Global Economy Faces Tougher Year: IMF Chief

For much of the global economy, 2023 is going to be a tough year as the main engines of global growth - the US, Europe and China - all experience weakening activity, the head of the International Monetary Fund (IMF) said on Sunday, Dan Burns reported for Reuters.

Photo Insert: The IMF chief attributes the tougher year ahead to the slowdown of the three big economies - the US, EU, and China.

The new year is going to be "tougher than the year we leave behind," IMF Managing Director Kristalina Georgieva said on the CBS Sunday morning news program "Face the Nation."

She added: "Why? Because the three big economies - the US, EU, and China - are all slowing down simultaneously," she said.

However, Georgieva said the US economy is standing apart and may avoid the outright contraction that is likely to afflict as much as a third of the world's economies. The "US is most resilient," she said, and it "may avoid recession. We see the labor market remaining quite strong."

In October, the IMF cut its outlook for global economic growth in 2023, reflecting the continuing drag from the war in Ukraine as well as inflation pressures and the high interest rates engineered by central banks like the US Federal Reserve aimed at bringing those price pressures to heel.

Since then, China has scrapped its zero-COVID policy and embarked on a chaotic reopening of its economy, though consumers there remain wary as coronavirus cases surge.

In his first public comments since the change in policy, President Xi Jinping on Saturday called in a New Year's address for more effort and unity as China enters a new phase. "For the first time in 40 years, China's growth in 2022 is likely to be at or below global growth," Georgieva said.

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