World economy to skirt recession but growth too low, German government sources say

By Thomson Reuters Apr 16, 2024 | 5:39 AM

By Christian Kraemer

BERLIN (Reuters) – The danger of a global recession has largely been averted but growth will be meagre, German government sources said, referring to International Monetary Fund forecasts that will be published later on Tuesday.

“The global economy is growing, but it is not growing very dynamically. In other places, like here, it is not growing at all,” one of the sources said.

Structural reforms are therefore necessary, they added.

“In the medium term, global growth prospects are also unsatisfactorily low,” a source said.

This week’s IMF spring meeting in Washington DC is taking place in difficult times, recently exacerbated by the Iranian attack on Israel.

On the margins of the meeting, the G20 finance ministers and central bank governors will hold two meetings, each focussing on a single topic.

On Wednesday evening, they will discuss climate financing, followed by a meeting on Thursday morning on strengthening international development banks.

A communique is not planned, the sources said.

German Finance Minister Christian Lindner and Bundesbank President Joachim Nagel called for the IMF to refocus on its core tasks, in a jointly written guest op-ed published in Germany’s Handelsblatt on Tuesday.

“Financing a development policy agenda is not the IMF’s original task and should rather be left to institutions such as the World Bank,” wrote Lindner and Nagel ahead of the spring meetings.

(Reporting by Christian Kraemer, Writing by Maria Martinez and Miranda Murray, Editing by Rachel More)