New International Monetary Fund (IMF) Managing Director Kristalina Georgieva cautioned on Tuesday that reports to be released next week will show the lowest global economic growth numbers this decade.
According to the Associated Press, the Bulgarian economist said in her first speech as head of the IMF that 90 percent of world economies will experience a decrease in growth amid what Georgieva described as a “synchronized global slowdown.”
Georgieva, who succeeded former IMF leader Christine Lagarde last month, attributed the “slowdown” to increased trade conflicts, namely the ongoing trade war between the United States and China. These conflicts, she said, could lead to a loss of $700 billion in world trade output, or 0.8 percent of the world’s GDP.
“Everyone loses in a trade war,” Georgieva said in her speech.
“Global trade growth has come to a near standstill,” she continued. “In part because of the trade tensions, worldwide manufacturing activity and investment have weakened substantially.”
President Trump has said that the U.S. would only see benefits from the tariffs that’s he’s placed on multiple countries and entities, including China, although recent recent stock numbers and economic reports have fueled economists’ fears that the fights could lead to a global recession.
“Even if growth picks up in 2020, the current rifts could lead to changes that last a generation — broken supply chains, siloed trade sectors, a ‘digital Berlin Wall’ that forces countries to choose between technology systems,” Georgieva noted.
Her remarks come before the IMF’s yearly meetings with its sister lending organization — the World Bank — in Washington next week.