Uncertainties too great to permit reliable forecasting: IMF MD on COVID-19 impact

International Monetary Fund (IMF) Managing Director (MD) Kristalina Georgieva has said that "uncertainties" arising out of the outbreak of coronavirus in China are "too great to permit reliable forecasting."

"We are still learning about how this complex virus spreads and the uncertainties are too great to permit reliable forecasting. Many scenarios can play out, depending on how quickly the virus is contained and how fast the Chinese and other affected economies return to normal," IMF Managing Director Georgieva said here on Saturday while speaking on 'Economic Impact of COVID-19.'

"In our current baseline scenario, announced policies are implemented and China's economy would return to normal in the second quarter. As a result, the impact on the world economy would be relatively minor and short-lived," she said.

The IMF Managing Director underlined that in this scenario, 2020 growth for China would be 5.6 per cent which is 0.4 percentage points lower than the January WEO Update and global growth would be about 0.1 percentage points lower.

"But we are also looking at more dire scenarios where the spread of the virus continues for longer and more globally, and the growth consequences are more protracted," she said.

"Global cooperation is essential to the containment of the COVID-19 and its economic impact, particularly if the outbreak turns out to be more persistent and widespread. To be adequately prepared, now is the time to recognise the potential risk for fragile states and countries with weak health care systems," she said.

"The IMF stands ready to help, including through our Catastrophe Containment and Relief Trust that can provide grants for debt relief to our poorest and most vulnerable members," added she.