The International Monetary Fund (IMF) has slashed its 2020 growth outlook for China to below 5.6% because of the “sheer geographic spread” of the coronavirus epidemic globally, IMF managing director Kristalina Georgieva said on Wednesday, reported the South China Morning Post.
Last month, the IMF forecast the outbreak could lower China’s economic growth this year to 5.6% – 0.4 percentage points below the organisation’s January estimate.
The forecast early this year was based on two assumptions – that the crisis would stay limited to China and that it would remain fully contained. But those conditions have failed to materialise, as community transmission of the disease has occurred in several countries.
“We are already looking at adverse scenarios … in which the impact on growth for China is more significant,” Georgieva told a joint press conference of the IMF and the World Bank. “The Chinese authorities themselves are recognising that there would be a lower growth this year. Again, we will have to work on the numbers, but it is very unfortunate that I have to say that that baseline scenario, no longer holds.”