International Monetary Fund (IMF) deputy managing director Zhang Tao speaks at the Peterson Institute for International Economics in Washington D.C., Oct 5, 2016. (Photo:China News Service/Zhang Weiran)
The world will continue to rely heavily on developing nations, amid slowing momentum, to help keep the world economy growing, said Zhang Tao, a Chinese economic official who is the new deputy managing director of the International Monetary Fund.
"Looking into the future, emerging markets and developing countries will continue to contribute a great share of global growth," Zhang told reporters on Sunday evening.
Zhang was at his first yearly meetings of the IMF and World Bank in his new job. Zhang replaced Zhu Min, also a Chinese national, on Aug 22. The meetings were from Friday to Sunday in Washington, DC. Zhang is a vice-governor of the People's Bank of China and was IMF executive director for China from 2011 to 2015.
The IMF has forecast global growth to slow to 3.1 percent in 2016, below the April forecast of 3.2 percent. The 2017 forecast is 3.4 percent, below April's 3.5 percent figure.
Zhang called growth in Europe flat, while the United States forecast has been cut by 0.6 percentage point, a change he said that has not surprised the market.
He says he thinks that Brexit and some issues debated during the 2016 US presidential election have discouraged investors, while many developed countries also face declining productivity and aging populations.
Zhang described the debate in some developed countries about income inequality and its relationship with globalization as going beyond the economics.
Still, the world's second-largest economy, China has been a major engine for the global economy before and after the 2008 financial crisis.
According to the latest World Economic Outlook report released last week, financial market sentiment toward emerging market economies has improved.
But prospects differ sharply across countries and regions, with emerging Asia in general and India in particular showing robust growth and sub-Saharan Africa experiencing a sharp slowdown.
In advanced economies, a subdued outlook subject to sizable uncertainty and downside risks may fuel further political discontent, with anti-integration policy platforms gaining more traction, according to the report.
