The managing director of the International Monetary Fund warned G20 about the impact of coronavirus epidemic in world economy as well as climate change, trade tensions and persistent inequality.
The managing director of the International Monetary Fund (IMF), Kristalina Georgieva, warned in the emirate city of Dubai that the growth of the world economy, estimated at 3.3 percent by 2020, could be reduced between 0, 1 percent and 0.2% percent for the coronavirus outbreak.
Georgieva explained that the epidemic could have a negative effect on global growth depending on China's ability to avoid its spread, therefor she asked not to draw "hasty conclusions." Even so, she acknowledged that the tourism and transport sectors, among others, have already been affected by the epidemic.
In a note for G20 finance ministers and central bankers, the global lender mapped out many risks facing the worldwide economy, including the disease and a renewed spike in United States-China trade tensions, as well as climate-related disasters, Al Jazeera reported.
"Uncertainty is becoming the new normal," Georgieva wrote in a blog posted on the IMF website. "While some uncertainties - like disease - are out of our control, we should not create new uncertainties where we can avoid it."
From trade to the #coronavirus, uncertainty is becoming the new normal. I believe that by working together on trade, climate and inequality, we can reduce uncertainty and put the global economy on more solid footing. Read my #IMFBlog on this topic: https://t.co/TKQbVgikjp #G20 pic.twitter.com/Hdvc9lNIIF— Kristalina Georgieva (@KGeorgieva) February 19, 2020
However, she declared in US television that the most likely scenario was a sharp decline in activities in China given the epidemic situation, followed by a rapid recovery and a relatively limited global impact.
Georgieva also urged G20 policymakers to act to reduce trade tensions, mitigate climate change and tackle persistent inequality. Cyber attacks, an escalation of geopolitical tensions in the Middle East or a breakdown in trade talks between China and the US could impede the short-term global recovery, the IMF stated.
Climate-related disasters, protectionism, and social and political unrest triggered by persistent inequality posed further economic risks.