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Trump’s Trade War Hurting China More Than US, According To IMF
Donald Trump’s claim that his protectionist measures are hurting China more than the US has received support from the International Monetary Fund in new forecasts showing how a fresh slowdown in the global economy has been concentrated in emerging economies.
The Washington-based IMF said the outlook was gloomier than it envisaged three months ago due to the tit-for-tat tariff war between the world’s two biggest economies, Brexit uncertainty and the impact of sanctions against Iran on oil prices.
In an update to its half-yearly World Economic Outlook, the IMF said it expected global growth to be 0.1 percentage points lower in both 2019 and 2020 than it envisaged in April, at 3.2% and 3.5% respectively.
The Fund’s country-by-country breakdown upgraded its forecast of US growth this year from 2.3% to 2.6% but downgraded China from 6.3% to 6.2%.
“In China, the negative effects of escalating tariffs and weakening external demand have added pressure to an economy already in the midst of a structural slowdown and needed regulatory strengthening to rein in high dependence on debt.”
Emerging and developing economies as a whole are now expected to grow by 4.1% this year – a cut of 0.3 points from April – with a slower pace of expansion pencilled in for Russia, India, Brazil and Mexico.
