The coronavirus epidemic could damage global economic growth this year, the IMF chief said on Sunday, but a sharp and rapid economic recovery could follow.
"There may be a cut we still hope to be in the 0.1-0.2 percent range," International Monetary Fund director Kristalina Georgieva told the Global Women’s Forum in Dubai.
She said the full effect of the spreading disease, which has already killed over 1,600 people, would depend on how quickly it was contained.
"I advise everyone not to jump to premature conclusions. There is still a lot of uncertainty. We are working with scenarios, not with projections, ask me in 10 days," said Georgieva.
In its January update of the global economic outlook, the IMF lowered its forecast for global economic growth in 2020 by 0.1 percentage points to 3.3 percent, after growth of 2.9 percent in the previous year, the lowest level in ten years.
Georgieva said it was "too early" to assess the full impact of the epidemic, but admitted that it had already affected sectors such as tourism and transportation.
"It's too early to say because we still don't know exactly what this virus is. We don't know how quickly China can curb it. We don't know if it will spread to the rest of the world," she said.
If the disease is "contained quickly, it can drop sharply and rebound very quickly," which is known as a V-shaped impact, she said.
Compared to the effects of Severe Acute Respiratory Syndrome (SARS) in 2002, China's economy at that time was only 8.0 percent of the world economy. Now it's 19 percent.
She said the trade agreement between the United States and China, the world's first and second economies, has reduced the disease's impact on the global economy.
However, the world should "worry about slow growth", which is characterized by uncertainty, said the IMF chief.
"We are now facing low productivity growth, low economic growth, low interest rates and low inflation," she told the Dubai Forum, which also included the daughter of US President Donald Trump, Ivanka, and former British Prime Minister Theresa May attended.
(Except for the headline, this story was not edited by NDTV staff and published from a syndicated feed.)