Overview: The road to global economic recovery is difficult to strengthen policy coordination into consensus

Geneva, 21 Jan (Xinhua) -- Roundup: It is difficult to strengthen policy coordination into a consensus on the road to global economic recovery

Xinhua News Agency reporter Chen Binjie, Kang Yi, and Fu Yiming

The 2022 World Economic Forum video conference closed on the 21st. In the discussion on the same day, a number of participants called for the road to world economic recovery to still face problems such as inflation and high debt, and unbalanced vaccinations, and that countries should be vigilant against risks and strengthen cooperation to avoid a greater crisis in the world economy.

Georgieva, president of the International Monetary Fund (IMF), said on the same day that in 2022, the road to global economic recovery will be full of bumps, and factors such as repeated new crown epidemics, high inflation in many countries, and record global debt levels are causing economic growth to lose momentum. She expects the world economy to continue to recover this year, but at a slower pace.

The data shows that more than half of the world's population has been vaccinated with two doses, but the data on vaccination rates in Africa is only 7%. Georgieva stressed that nearly 90 countries have not reached the vaccination target, and the vaccination rates of various countries are widely different and very dangerous.

The Global Investment Trend Monitoring Report released by the United Nations Conference on Trade and Development predicts that the growth prospects for global foreign direct investment (FDI) in 2022 remain positive, but are unlikely to continue to maintain high growth rates in 2021.

The fiscal and monetary policies of many advanced economies are also under pressure. Bank of Japan Governor Toshihiko Kuroda said Japan's economic recovery was lagging behind and that public sector debt now far exceeded gross domestic product (GDP). The Japanese government expects a basic surplus to begin in 2025, after which public debt levels will decline. Kuroda expects Japan's inflation rate to remain at 1% in 2022 and said the BoJ will continue to maintain accommodative monetary policy.

In her speech, European Central Bank President Christine Lagarde said that as of now, inflationary pressures in Europe are not out of control, and market demand and employment participation have just returned to pre-pandemic levels. She said that in the face of the impact of the epidemic, proper monetary and fiscal policies are important countermeasures.

Brazil's economy minister, Paulo Guedes, believes that inflation will be a long-term problem in the Western world and that inflationary pressures will not disappear in the short term.

Looking ahead, Georgieva stressed that central banks and fiscal policymakers around the world should "prevent the world from falling into another Great Depression in a highly coordinated manner." She believes that maintaining policy flexibility is critical to the global recovery in 2022.

Liang Guoyong, a senior economist at the United Nations Conference on Trade and Development, said in an interview with Xinhua News Agency that the world economic trend in 2022 may show the characteristics of "weak recovery" and "high risk", and emerging economies and developing countries should first strengthen risk prevention to avoid external financial risks from causing serious impacts on their own economies.

Liang Guoyong believes that the negative spillover effect of monetary policy adjustments in major developed economies such as the United States is very large, which will bring major risks to the world economy. Some economies that lack economic resilience and have weak financial systems that are less resilient to risks may experience severe financial crises. He said that the central banks of major economies in particular need to strengthen policy communication and focus on reducing external shocks and spillovers caused by monetary policy adjustments in major developed countries.

(Xinhuanet)