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CGD in the News

Official economic forecasts for poor countries are too rosy (Economist)

August 4, 2020

From the article:

"The fund’s lack of consistency attracts criticism, too. Since the coronavirus pandemic began it has revised down growth in rich countries in 2020 by three percentage points more than that in developing ones. That is odd, argued Justin Sandefur of the Centre for Global Development, another think-tank, and Arvind Subramanian of Ashoka University, in June. Lockdowns and social distancing are at least as severe in poor countries as in rich ones. But fiscal responses have been much weaker, and, as the fund itself has argued, capital outflows and currency pressure are bigger threats. Perhaps, the authors speculate, the fund has been rosier about poorer countries this time in order to avoid having to provide support. Theimf says that China’s success in containing the virus explains why its forecasts are more positive for developing countries and strongly denies lending influences its growth forecasts."

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