IMF warns growth in Pakistan expected to decline to 1.5 in 2019

WASHINGTON: The global economy is facing a "delicate moment," beset with risks as the recovery loses steam amid trade tensions, Brexit and other factors, the International Monetary Fund warned Tuesday.

The IMF´s World Economic Outlook once again downgraded global growth to 3.3 percent for 2019, two tenths lower than the global crisis lender forecast in January and four tenths lower than October.

And while world growth is expected to pick up in the second half of this year and hit 3.6 percent in 2020, many things will have to go right for that to happen, including a resolution of President Donald Trump´s trade battle with China.

The quarterly report "projects a slowdown in growth in 2019 for 70 percent of the world economy," IMF chief economist Gita Gopinath said in a statement, but stressed that "global recession is not in the baseline."

Growth in the Middle East, North Africa, Afghanistan, and Pakistan region is expected to decline to 1.5 percent in 2019, before recovering to about 3.2 percent in 2020. The outlook for the region is weighed down by multiple factors, including slower oil GDP growth in Saudi Arabia; ongoing macroeconomic adjustment challenges in Pakistan.

The medium-term outlook for the Middle East, North Africa, Afghanistan, and Pakistan region is largely shaped by the outlook for fuel prices, needed adjustment to correct macroeconomic imbalances in certain economies, and geopolitical tensions.

In Pakistan, in the absence of further adjustment policies, growth is projected to remain subdued at about 2.5 percent, with continued external and fiscal imbalances weighing on confidence.