IMF chief: Trade conflicts are diming global growth outlook
(VOVWORLD) - Trade disputes and tariffs are starting to dim the outlook for global growth, International Monetary Fund (IMF) Managing Director Christine Lagarde said in a speech on Monday ahead of the IMF and World Bank annual meetings next week in Indonesia.
 IMF Managing Director Christine Lagarde. (Photo: AFP/VNA) |
She called on countries to resolve their differences and reform global trading rules.
Lagarde said tariff barriers are constraining global growth, hurting not just trade, but also investment and manufacturing. While the US economy is growing strongly because of tax cuts and deregulation, there are signs of economic slowing in Europe and Japan. She added that China is also showing signs of growth moderation, a trend that will be exacerbated by China’s trade dispute with the US, which has imposed tariffs on 250 billion USD worth of imports from China and is threatening tariffs on 267 billion USD more.
The trade war, along with higher interest rates and a stronger US dollar, is starting to affect some emerging market countries, Lagarde said, citing new IMF research that suggests emerging market countries excluding China could potentially face debt portfolio outflows of up to 100 billion USD, a level that would broadly match outflows during the global financial crisis a decade ago.
Lagarde called on countries to de-escalate and resolve the current trade disputes and start to work on building better rules for the global trading system, including reforms to the World Trade Organization.