Washington (AFP)
The signing of the Sino-US trade agreement is a breath of fresh air for the global economy, whose growth will rebound this year. But the recovery will be "slow" and weakened by the persistence of geopolitical risks, warned the IMF on Monday.
The International Monetary Fund was less optimistic than in October in its latest global growth forecasts published on Monday, now counting on 3.3% this year and 3.4% next year (-0.1 point and - 0.2 points respectively).
But it is much better than last year when, under the effect of the trade war between the United States and China, the increase in the volume of international trade had melted (+ 1% after 3% in 2018) and brings the planet's growth to 2.9%, its lowest level since the financial crisis.
Nothing to celebrate, however. This recovery is hampered by "bad news" from India, which is suffering among other things from the decline in consumption, investment, budget deficits and delays in structural reforms.
In addition, in other countries, economies are shaken by a deep street protest.
This is the case of Chile in Latin America. The social crisis started there in October, with student demonstrations against an increase in the price of the metro ticket, which have turned into a revolt of unprecedented scale since the end of the dictatorship of General Augusto Pinochet (1973 -1990).
In addition, the resumption of geopolitical tensions, especially between the United States and Iran, could disrupt the world supply of oil, damage morale and weaken already timid commercial investments, the Fund said in a statement.
- No room for "political missteps" -
On the international trade front, the truce between Washington and Beijing, sealed last week by the signing of a bilateral agreement, does not resolve everything.
"There is still much to do to heal the fractures between the two main economic powers on the planet," said IMF Managing Director Kristalina Georgieva on Friday during an intervention before the Peterson Institute for international economics (PIIE).
Beyond these two countries, "the whole world trading system is in need of deep improvement," she said.
In addition, "commercial truce does not mean commercial peace", she warned.
For now, the first phase of the Sino-US agreement will boost China's growth this year. The IMF now expects an increase of 6%, 0.2 points more than the October estimate.
The United States will also benefit from this agreement which will boost its exports of agricultural, industrial and energy products.
But the expansion is running out of steam. US GDP growth will slow to 2% (-0.1 point) after 2.3% last year, the effects of the tax reform fading.
However, the leading power in the world will continue to race ahead of advanced countries, far from the countries of the euro area (+ 1.3%) and Japan (+ 0.7%).
Emerging and developing countries will increase by 4.4% after 3.7% in 2019.
The volume of international trade, which carried the recovery after the global recession, will recover this year (+ 2.9% against 1% last year).
But the increase will be lower than that estimated in October and far from the 3.7% recorded in 2018.
On a more positive note, temporary factors that had slowed global production such as the adaptations of the automotive sector to the new emission standards seem to be fading.
The fact remains that all these projections "depend to a large extent on the ability (of the leaders) to avoid a further escalation of American-Chinese trade tensions (...), to avoid a Brexit without agreement and the economic ramifications of social unrest and geopolitical tensions, "warns the Washington institution.
If so, the recovery could be seriously started.
"Political missteps at this stage would further weaken an already weak global economy," concludes the Fund, which sees 2020 as an "attempt at stabilization".
© 2020 AFP