Post-pandemic recovery: Advanced economies will be back on track by 2024, says IMF’s Gita Gopinath

Virendra Pandit

New Delhi: International Monetary Fund (IMF)’s First Deputy Managing Director Gita Gopinath said on Wednesday the pandemic-afflicted advanced economies will be back on track by 2024 but developing economies will be 5 percent below where they would have been otherwise.

Covid-19 had adversely affected economies worldwide. They are slowly coming back into the recovery path.

Speaking at a special session on ‘What next for global growth?’ during the ongoing World Economic Forum (WEF) Annual meeting 2022 at Davos, Gopinath said the war in Ukraine has been a major setback to the global recovery.

“We had a serious downgrade to the global growth rate, and the world continues to face headwinds because we have a cost-of-living crisis. Prices of commodities including fuel and food are going up around the world,” she said.

She said central banks are trying to tackle this high level of inflation and raising interest rates sharply, which they must do, but that will also have consequences for global finance and trade.

Gopinath said there are very divergent economic recoveries around the world.

“While advanced economies, as per our estimates, will basically get back to where they would have been in absence of pandemic in 2024, emerging and developing economies would be 5 percent below where they would have been,” she said.

The panelists discussed that the recovery from the pandemic-triggered economic crisis has remained deeply uneven within and between countries, depending on their access to financial resources and vaccines.

As food, fuel, and financial resource crises now risk further derailing a fair recovery, they discussed how a broader set of foundations for growth can ensure long-term economic prosperity and a return to international convergence, the media reported.