The International Monetary Fund (IMF) has halved its global growth expectations to 3.2% in 2022 from 6% in 2021 amid climbing inflation and monetary policy tightening.<\/p>\n
Consequently, South Africa\u2019s growth rate has also been revised downwards. The country is expected to grow by 2.1% in 2022 from 4.9% in 2021, with 2023 expected to drop further to 1.1%. In contrast, Sub-Saharan Africa is expected to grow by 3.7% in 2023.<\/p>\n
The IMF\u2019s global growth profile for October 2022<\/a> is the weakest economic outlook report since 2001. This is partly due to this year\u2019s economic shocks created by the war in Ukraine, driving up food and energy prices following the coronavirus outbreak.<\/p>\n This has created an environment where soaring costs and rising interest rates have created growth-stifling fears around the globe.<\/p>\n \u201cMore than a third of the global economy is headed for contraction in 2022 or 2023,\u201d said IMF economic counsellor Pierre-Olivier Gourinchas in a blog post accompanying the fund\u2019s latest report.<\/p>\n He warned that the world\u2019s three biggest economies – the United States, European Union and China – will continue to stall.<\/p>\n China\u2019s growth, for example, is now at the lowest its been in 40 years at 3.2% if you exclude the 2020 economic crisis.<\/p>\n These conditions are expected to negatively impact advanced and emerging economies \u2013 including South Africa \u2013 as disruptions in exports and imports with these big three economies will likely be affected by the contractions.<\/p>\n