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Is the global economy on the brink of recession? In any case, this is what the International Monetary Fund believes, which anticipates a year of very weak growth. At issue: the war in Ukraine, high inflation and a slowdown in Chinese GDP. The IMF is revising down its growth forecast for China in 2023.
With our correspondent in Beijing, Stephane Lagarde
This is an announcement that the Chinese Communist Party would have gone well on the eve of its 20th Congress. ” Growth in China has weakened significantly since early 2022 “, Notes the international monetary institution which points to Chinese health policy and repeated confinements, including that of Shanghai last spring.
Another bright red light: that of the real estate crisis, a sector that has long been the engine of growth and the main source of funding for local governments in China. The fallow sites of bankrupt developers, the concrete skeletons, the unfinished residential or office towers throughout the country have become symbols of a slowing economy.
Added to this is the trade war with the United States and Washington’s desire to decouple, in other words to remove the links between American companies working on technologies qualified as strategic and Chinese companies. A context that does not help to revive domestic consumption.
The IMF maintains its growth forecast for China at 3.2% this year – the lowest rate in four decades, well below the 5.5% official target – and lowers its forecast for next year (4.4 to 4.6%). A worried prognosis sent to future Chinese leaders gathered in Beijing next Sunday to change gear. Because if the Chinese economy catches a cold, global supply chains risk seizing up.