The Financial Express

IMF lifts China’s GDP forecast to 1.9pc in 2020

| Updated: October 18, 2020 16:08:04

IMF lifts China’s GDP forecast to 1.9pc in 2020

The IMF projects that China's GDP will grow by 1.9 per cent in 2020, up from 1.0 per cent in its last projection in June, citing a faster-than-expected recovery in China.

China will be the only major economy to achieve growth this year, according to the IMF's latest report in October.

The report forecast that Chinese economic growth will reach 8.2 per cent in 2021, unchanged compared with its June outlook.

Economists recently interviewed by the Global Times said that China's economy is likely to grow by 6.0 per cent in both the third and the fourth quarter, with the full-year figure staying around 2.5 per cent.

As China is pivoting to a new development pattern focused on the domestic economy, which some analysts have called "internal circulation," consumption is expected to become a major driver of the economy starting in the current quarter.

Global trade began recovering in June as lockdowns in major economies were eased. The IMF said that China is an important contributor to this trend.

China's exports jumped 10.2 per cent year-on-year to 5 trillion yuan ($742 billion) in the third quarter while imports were up 4.3 per cent to 3.88 trillion yuan, data from the Chinese General Administration of Customs showed on Tuesday.

In the report, the IMF forecast that the global economy will contract 4.4 per cent in 2020, which is a less severe contraction than forecast in its last report because activity began to improve sooner than expected after lockdowns in advanced economies were scaled back in May and June.

Yet, the IMF warned that the world economy's long ascent back to pre-pandemic levels of activity "remains prone to setbacks." It forecast that the US economy would contract 5.8 per cent this year, Germany would shrink 6.0 per cent and India 10.3 per cent.

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