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Arab and international
Economy News – Baghdad
The International Monetary Fund considered that US President Joe Biden’s plan to stimulate the domestic economy will positively affect global growth.
“The US plan will have” positive effects on the rest of the global economy, “a spokesman for the fund, Gary Rice, told a news conference in Washington, DC.
He expected most countries to benefit from “the increase in American demand for basic commodities, as well as imports of goods and services … which will contribute to global growth and recovery.”
But the international official called for monitoring the potential risks of pumping huge amounts of money into the world’s largest economy. Analysts expect the plan to lead to higher inflation.
And economists around the world have recently raised warnings of the possibility of a sharp inflation wave in the various countries that have approved stimulus packages, with the wave reaching developing countries and negatively affecting the economic growth figures for the world as a whole.
“We have to be alert to the risks, and countries must be alert to any potential risks,” Rice said.
In January, the IMF expected the US economy to grow 5.1 percent in 2021.
Rice said that the fund is currently expecting, after the stimulus plan, additional growth between 5 to 6 percent annually over the next three years in the United States, and “this means reviewing positive expectations for the US economy, and raising global growth expectations.”
The fund is expected to publish an update on global economic growth expectations, through the “World Economic Outlook” report, on April 6.
“Until then, we will conduct a more in-depth analysis of the impact of the American recovery plan,” added the Fund spokesman.
Last January, the International Monetary Fund raised global growth forecasts from 5.2 percent to 5.5 percent. As a result of the acceleration of vaccine campaigns against the Corona virus, and the government’s economic support plans.