## IMF Survey : Modest Growth Pickup in 2013, Projects IMF

_IMF News, January 23, 2013_

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## Bibliographic details
- Published: January 23, 2013

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### Global outlook and headline projections
- Global growth projected to strengthen to 3.5 percent in 2013, from 3.2 percent in 2012.
- The 2013 projection is a downward revision of just 0.1 percentage point compared with the October 2012 WEO.
- Recovery is gradual and slow; policies must address downside risks to bolster growth.
- If crisis risks do not materialize and financial conditions continue to improve, global growth could be stronger than forecast.

### Recent developments and drivers
- Economic conditions improved slightly in Q3 2012, driven by performance in emerging market economies and the United States.
- Financial conditions improved: borrowing costs for countries in the euro area periphery fell, and many stock markets rose.
- Activity in the euro area periphery was softer than expected, with some weakness spilling over to the euro area core.
- Japan moved into recession in the second half of 2012.
- Japan’s stimulus plans will help boost growth in the near term, pulling the country out of a short-lived recession.

### Regional forecasts and specifics
- Euro area: near-term forecast downgraded; the region is now expected to contract slightly in 2013.
  - Policy actions reduced risks and improved financial conditions for governments and banks in periphery economies, but had not yet translated into improved borrowing conditions for the private sector.
- United States: IMF forecasts growth of 2 percent in 2013, broadly unchanged from the October 2012 WEO.
  - A supportive financial market environment and a housing market turnaround will support consumption growth.
- Japan: Near-term outlook unchanged despite slipping into recession; stimulus package and further monetary easing will boost growth.
- Emerging market and developing economies: expected to grow by 5.5 percent in 2013, broadly as predicted in the October 2012 WEO.

### Risks and scenarios
- Crisis risks have abated in the euro area and the United States, but downside risks remain significant.
- Major downside risks include:
  - Prolonged stagnation in the euro area.
  - Excessive short-term fiscal tightening in the United States.
- The risk of prolonged stagnation in the euro area would rise if momentum for reform is not maintained.
- If crisis risks remain contained and financial conditions keep improving, growth could exceed the baseline projection.

### Policy recommendations and priorities
- Euro area:
  - Continue adjustment programs in periphery countries.
  - Deploy “firewalls” to prevent contagion.
  - Take further steps toward banking union and fiscal integration.
- United States:
  - Avoid excessive fiscal consolidation in the short term.
  - Promptly raise the debt ceiling.
  - Agree on a credible medium-term fiscal consolidation plan, focused on entitlement and tax reform.
- Japan:
  - Establish a credible medium-term fiscal strategy to mitigate risks that the stimulus-induced recovery could prove short lived and that the debt outlook could worsen.
- Emerging market and developing economies:
  - Rebuild policy room for maneuver.
  - Pace rebuilding to balance external downside risks against risks of rising domestic imbalances.

*Source: IMF Survey : Modest Growth Pickup in 2013, Projects IMF — January 23, 2013.*

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## References

- [https://www.imf.org/en/News/country-focus](https://www.imf.org/en/News/country-focus)
- [PRESS CENTER](http://presscenter.imf.org/)
- [In The News](https://www.imf.org/en/news/search)
- [WEO: read the forecast](http://www.imf.org/external/pubs/ft/weo/2013/update/01/index.htm)
- [Video: Olivier Blanchard](http://www.imf.org/external/mmedia/view.aspx?vid=2111332842001)
- [Podcast: Blanchard on 2013](http://www.imf.org/external/pubs/ft/survey/so/PodcastArchive.aspx)
- [Video: Lagarde looks at 2013](http://www.imf.org/external/mmedia/view.aspx?vid=2101153841001)
- [https://www.imf.org/en/home](https://www.imf.org/en/home)

_Source: https://www.imf.org/en/news/articles/2015/09/28/04/53/sonew012313a_