International Monetary Fund: 'Be careful!'

IMF spokesperson Kozack made assessments regarding developments in the global economy at a press conference she held.

Recalling that they raised their global economic growth forecast for 2024 to 3.1 percent in January compared to October, Kozack explained that this was largely due to resilience in the US and some emerging market countries.

However, Kozack pointed out that this growth forecast remains below the 3.8 percent growth average of the 2002-2019 period before the COVID-19 pandemic, and said that inflation has fallen faster than expected in most regions due to the easing of supply constraints and the effect of tight monetary policy.

Stating that Japan performed below expectations in the second half of 2023 due to weak domestic consumption and investment, Kozack noted that growth remained robust throughout last year thanks to exports.

Kozack noted that they anticipate the weak growth performance at the end of last year could increase downside risks for the Japanese economy in 2024.

Reminding that the UK also contracted in the last quarter of last year, Kozack explained that high-frequency indicators point to an improvement this year.

Kozack announced that they will take these new developments into account as they begin the process of raising forecasts for the global economy, and that these forecasts will be published in April.

Drawing attention to the fact that despite the decline in inflation, it is not yet close enough to the target, Kozack said, "This means that the work is not yet finished regarding monetary policy. We call on central banks to be cautious against premature easing of monetary policy."

"UKRAINE'S FINANCING NEEDS ARE SERIOUS"

Kozack recalled that with the 900 million dollars in December last year, they have increased the amount paid to Ukraine under the program to approximately 4.5 billion dollars to date.

Stating that an IMF team is in Warsaw to conduct the third review under the program related to Ukraine, Kozack expressed that Ukraine's financing needs are quite serious.

Kozack noted that they estimate Ukraine will need approximately 42 billion dollars for 2024, including about 31.9 billion dollars in official donor support, and that timely support from the international community, including the US, will be vital for the country.

Stating that the decision on what to do with frozen Russian assets belongs to the countries holding the assets, Kozack drew attention to the importance of any action having a sufficient legal basis to avoid potential risks.

Kozack stated that the Russian economy has surprised with its growth strength, explaining that the reason for this is the large amount of military spending that increases production in the economy and the many social transfers that help boost consumption.

"WE LOWERED THE MENA GROWTH FORECAST"

Recalling that they lowered their 2024 growth forecasts for the Middle East and North Africa (MENA) region by half a percentage point compared to the October projection, Kozack stated that this is due to the devastating humanitarian and economic impact of the conflicts in the region.

Referring to the IMF's port monitoring platform, which tracks shipping volumes in many areas, Kozack said that the cargo volume in the Suez Canal decreased by 55 percent on an annual basis in the week ending February 13, and the cargo volume passing through the Cape of Good Hope increased by approximately 75 percent.