IMF: GLOBAL ECONOMIC GROWTH IS PICKING UP, ACCELERATING BY 3.5% IN 2017

The International Monetary Fund (IMF) predicts that the world economy will grow 3.5 percent this year, up from 3.1 percent in 2016. The IMF’s latest outlook for 2017 is a slight upgrade from the 3.4 percent global growth it had forecast in January.

The IMF expects the U.S. economy to grow 2.3 percent, up from 1.6 percent in 2016; the 19-country eurozone to expand 1.7 percent, the same as last year; Japan to grow 1.2 percent, up from 1 percent; and China to expand 6.6 percent, down from 6.7 percent in 2016.

One decidedly weak area is Africa, for which the IMF describes the outlook as subdued. For sub-Saharan Africa, economic growth is likely to only moderately exceed population growth. That means correspondingly only moderate progress in raising average living standards in the region.

“Momentum in the global economy has been building since the middle of last year,” the IMF’s chief economist, Maurice Obstfeld, said. But, he added, “We cannot be sure we are out of the woods.”

The monetary fund’s latest outlook for the economy comes in advance of spring meetings in Washington this week of the IMF, the World Bank and the Group of 20 major economies. The meetings come against the backdrop of a gradually strengthening international picture, especially in many emerging economies, despite resistance to free trade and political unrest in some countries.

For years after the 2008 financial crisis and the Great Recession ended, the global economy remained trapped in what the IMF’s managing director, Christine Lagarde, termed “the New Mediocre.” Banks were weak and reluctant to lend, and deeply indebted governments made growth-killing budget cuts.

The once-super-charged Chinese economy began a long slowdown, driving down global commodity prices and hurting countries from Australia to Zambia that fed raw materials to the world’s second-biggest economy. Plummeting oil prices forced energy companies to slash production.

Now, Lagarde and others say, the outlook is brightening. China’s economy has steadied, thanks to government spending and an easy-money credit boom. Beijing said Monday that its economy grew at a 6.9 percent annual pace from January to March, the fastest in more than a year. Thanks in part to relief over China’s prospects, global commodity prices have stabilized after plummeting from mid-2014 to early 2016.