The IMF's General View On ASEAN's Economic Growth In The Future

Implementing Director of the International Monetary Fund Kristalina Sarawa (Photo: Doc. IMF)

JAKARTA - The Managing Director of the International Monetary Fund (IMF) Kristalina Sarawa stated that the ASEAN area is believed to reach a growth of 4.5 percent in 2023 and the same range in 2024.

According to him, countries in Southeast Asia are a contributor to 10 percent of global growth.

However, Crystal said ASEAN had its own challenges.

"ASEAN suffered significant losses due to supply chain disruptions and low external demand due to global shocks," he said in a series of ASEAN Summits this week in Jakarta.

Crystal explained that the average growth in the last three years was only half of projections before the pandemic, resulting in output losses of around 8 percent of GDP or far above the global average.

Therefore, he assessed that ASEAN requires stronger growth to fully recover and continue the path to prosperity before the pandemic.

This is not an easy task. Economic fragmentation makes it even more difficult. If the world is divided into separate economic blocks, it will have major implications for a dynamic open economy like ASEAN. That's why it is very important for us to work together to combat this threat," he said.

Crystal added that the IMF found that economic growth in developed areas was still restrained, such as Europe, the United States, and China.

The Zona Euro is still around 2 percent below the trend, while China and other emerging markets and other developing countries are about 5 percent below the trend, and low-income countries are even more hit, he said.

We expect this weak performance to continue, with global growth of about three percent in the medium term. This is the lowest growth rate in decades, in inflation conditions where interest rates are expected to be higher over a longer period of time and in the context of increasing risk of fragmentation, "concluded Crystal.