WASHINGTON - Tariffs that have been
imposed or threatened by the United States and China could shave
0.8% off global economic output in 2020 and trigger additional
losses in future years, the International Monetary Fund said on
Thursday.
IMF spokesman Gerry Rice said trade tensions were beginning
to affect a world economy that is already facing challenges,
including a weakening of manufacturing activity not seen since
the global financial crisis of 2007-2008.
Rice, speaking at a regularly scheduled IMF news conference,
said the global lender is due to release a new revised economic
outlook next month, but provided no details.
The pace of world economic activity remained subdued, with
rising trade and geopolitical tensions causing uncertainty and
eroding business confidence, investment and trade, he said.
The IMF had previously forecast that the U.S.-China trade
war and other trade disputes threatened global growth in the
future, but Rice said the impact was now being felt.
"Trade tensions .... are not only a threat, but are actually
beginning to weigh down the dynamism in the global economy," he
said. "Our latests estimate is that ... the U.S.-China tariffs,
including those implemented and announced, could potentially
reduce the level of global GDP by 0.8% in 2020, with additional
losses in future years."
That forecast is more gloomy than one earlier this year,
when the IMF said tariffs already imposed and those planned
could shave 0.5% off global economic output in 2020.
Asked if the IMF now anticipates a global recession, Rice
said that was not in the fund's baseline at the moment, although
the IMF had used words such as "very precarious," "very
fragile," and "delicate" to describe the economic outlook.
"Let's not get ahead of ourselves. Let's wait and see," he
said, noting the forthcoming world economic outlook would
provide greater clarity.
At the same time, Rice stressed he was not predicting or
hinting that the IMF planned to forecast a recession.