IMF raises its forecast for the growth of the Saudi economy to 2.8% in 2021

The International Monetary Fund (IMF) raised its forecast for the growth of the Saudi economy by 0.4% to 2.8% this year, while maintaining its forecast for the growth of the Kingdom’s economy by 4.8% in 2022, and this comes at a time when it slightly lowered its forecast for global economic growth in 2021 to 5.9%.

The IMF said in its October World Economic Outlook that the inflation outlook was unclear, despite expectations that pressure on commodity prices would ease in 2022.

The International Monetary Fund indicated in its global economic forecasts that the second economic power in the world will record this year’s growth in its gross domestic product that does not exceed 8%.

The fund’s forecast for 2022 indicates a growth of 5.6%, a decrease of 0.1 points from previous expectations.

The Fund explained that “after a significant financial recovery last year” to support the resumption of economic activity after the health crisis, it is expected that China will “significantly reduce” its expenditures from 2021.

Public investment, particularly in infrastructure and the real estate sector, was an engine of growth when the Chinese economy was slowing.

However, the financial difficulties faced by the giant Chinese real estate company “Evergrand”, which may lead to its bankruptcy, raise the concerns of economists, and prompted several international banks recently to reduce their forecasts for the growth of China’s GDP.

Last year, China was the only major economy that recorded a positive growth of 2.3 percent, despite the health crisis that was casting a shadow on the global economy.

According to official figures, China expects a growth of no less than 6% this year, which is much lower than the expectations of the International Monetary Fund, and China is supposed to achieve it easily.

However, the International Monetary Fund warns of geopolitical points of tension between Beijing and Washington that threaten to affect the global economic recovery, especially since US President Joe Biden did not stop the trade war launched by his predecessor Donald Trump in 2018.

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