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IMF Head Warns One-Third of World Lurching Toward Recession

Kristalina Georgieva was particularly foreboding where China was concerned.

By , a global affairs journalist and the author of The Influence of Soros and Bad Jews.
Kristalina Georgieva speaks to the media in Berlin.
Kristalina Georgieva speaks to the media in Berlin.
Kristalina Georgieva, managing director of the International Monetary Fund, speaks to the media following talks at the German Chancellery in Berlin on Nov. 29, 2022. Carsten Koall/Getty Images

Welcome to today’s Morning Brief, where we’re looking at predictions of global recession, tensions in Kashmir, and a Ukrainian attack on Russian forces in Donetsk.

If you would like to receive Morning Brief in your inbox every weekday, please sign up here.


IMF: One-Third of Global Economy Headed for Recession

Welcome to today’s Morning Brief, where we’re looking at predictions of global recession, tensions in Kashmir, and a Ukrainian attack on Russian forces in Donetsk.

If you would like to receive Morning Brief in your inbox every weekday, please sign up here.


IMF: One-Third of Global Economy Headed for Recession

International Monetary Fund (IMF) head Kristalina Georgieva warned one-third of the global economy will be in recession this year.

Speaking on the CBS show Face the Nation, Georgieva said this year will be “tougher” than last and that the United States, European Union, and China will see economic slowdowns. Her comments follow the IMF’s decision last October to cut its global economic growth projection for 2023, a response to, among other things, Russia’s war in Ukraine and higher interest rates around the world.

Georgieva also offered that even in countries that are not in a recession, “it would feel like recession for hundreds of millions of people.”

Georgieva’s gloomy forecast paid particular attention to China. “For the next couple of months, it would be tough for China, and the impact on Chinese growth would be negative. The impact on the region will be negative. The impact on global growth will be negative,” she said.

China recently reversed some of its policies toward COVID-19, effectively ending its zero-COVID approach, and began reopening its economy. But COVID-19 cases are spreading. Chinese President Xi Jinping has called for unity as the country enters a “new phase.”

China, Georgieva said, will likely grow at or below global growth for the first time in 40 years. What she described as a “bushfire” of COVID-19 infections should be expected to hurt the country’s economy—and also impact regional and global growth.

Georgieva called the U.S. economy the “most resilient” and said the United States “may avoid recession.” But she also called a strong labor market a “mixed blessing,” as it may lead the U.S. Federal Reserve to keep interest rates tight so as to combat high inflation, which could have negative economic consequences of its own.


FP Live | Jan. 3: How will the various crises in the world play out in 2023, and what can the international community do to mitigate them? International Rescue Committee CEO David Miliband will join FP’s Ravi Agrawal to discuss the world’s most urgent crises, from Ukraine to Ethiopia, and more. Register now.


What We’re Following Today 

Five civilians killed in Kashmir. Two children were killed and several people were wounded in an explosion in Indian-controlled Kashmir, according to police. This came a day after assailants “sprayed bullets” at homes, killing four people. The victims of these attacks were reportedly all Hindus. It remains to be seen what this means more broadly for tensions in Kashmir. The region as a whole is disputed, claimed by both India and Pakistan.

Until a few years ago, India granted Indian-controlled Kashmir “special status,” which allowed the state to have a certain degree of autonomy. In August 2019, that special status was revoked, which was understood as an attempt to integrate Kashmir more fully into India and was seen by many as an attempt to curtail individual rights in the predominantly Muslim region in the name of cracking down on militancy.

Israel’s new foreign minister on Russia’s war in Ukraine. Israeli Foreign Minister Eli Cohen said Monday that Israel will “speak less” in public on the conflict, which was taken in some corners to mean that Israel will offer less censure of Russia. Cohen is expected to speak with his Russian counterpart, Foreign Minister Sergey Lavrov, on Tuesday. Cohen’s comments come a few days after Pinchas Goldschmidt, Moscow’s chief rabbi in exile, told the Guardian that Russia’s Jews should leave the country while they still can and before they are scapegoated.


Keep an Eye On

Ukrainian forces killed 63 Russian soldiers. Russia’s defense ministry said a Ukrainian attack on a facility in Donetsk where Russian troops were stationed killed 63 soldiers on Monday. The Russian defense ministry did not say when the attack happened but did say the Ukrainian side fired six rockets from a U.S.-supplied High Mobility Artillery Rocket System. Ukraine did not confirm the strike, though appeared to comment on what might have been the same strike.

Ukraine’s armed forces said 400 Russian soldiers were killed in a vocational school building in Makiivka on Sunday. The Russian statement did not mention a vocational school but said the strike took place “in the area of Makiivka.”

Dozens escape from jail in Mexico. Gunmen thought to be part of a drug cartel opened fire on the Chihuahua state prison in northern Mexico on Sunday. Dozens of inmates—24 people, according to police—escaped from the facility. Ten people, including four prisoners, were killed. This was the same prison where a riot inside the facility ended up killing 11 people last August. Mexico’s armed forces have been called in to assist local authorities.


Monday’s Most Read

10 Conflicts to Watch in 2023 by Comfort Ero and Richard Atwood

The Myth of America’s Ukraine Fatigue by Raphael S. Cohen and Gian Gentile

Elections to Watch in 2023 by Allison Meakem


Odds and Ends 

A New Year’s Eve fireworks show in Scarborough, England, was canceled so as not to disturb a walrus. As council leader Steve Siddons put it, though it was disappointing, “the welfare of the walrus has to take precedence.”

Emily Tamkin is a global affairs journalist and the author of The Influence of Soros and Bad Jews. Twitter: @emilyctamkin

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