Georgieva: IMF may have to lower China growth forecasts

BERLIN, Nov 30 ― The International Monetary Fund (IMF) may have to slash its growth forecasts for China, managing director Kristalina Georgieva warned yesterday, after protests erupted opposing Beijing’s strict policies to combat Covid.

“There is indeed the possibility that, in this time of very high uncertainty, we might have to revise these projections down,” Georgieva said, referring to the fund’s forecasts for China.

In October, the IMF cut its projection for the world’s number two economy to 3.2 per cent this year as it is weighed down by Covid-zero policies, as well as a slowdown in the property sector.

It projected China’s growth would rise to 4.4 per cent next year.

Beijing’s tough approach involves compelling local governments to impose snap lockdowns and quarantine orders, and limit freedom of movement in response to minor outbreaks.

Demonstrations not seen in decades erupted in major cities at the weekend opposing Covid lockdowns and demanding greater political freedoms.

Georgieva, speaking in Berlin after meeting Chancellor Olaf Scholz and heads of other international financial organisations, said China was “looking into its zero-Covid policy with a perspective to shift to more targeted response to Covid cases”.

This was aimed at ensuring “less interruptions to the Chinese economy, and less negative spillover for the rest of the world,” she said.

“We have been supportive of looking into what China can do to make its Covid policy more effective for China itself and for its role in the world economy.” ― AFP