IMF: Only One Year of Below-Average Growth in a Decade-Long Strong Global Economic Expansion?

According to the International Monetary Fund's most recent economic outlook, world real GDP growth is projected to slow from 5% in 2007 to 3.75% percent in 2008 and then to 2.2% in 2009 (see chart above), with the downturn led by advanced economies.

Looking forward, the IMF predicts that world real GDP will rebound to above-average growth rates of 4.2% (2010), 4.8% (2011), 4.8% (2012) and 4.7% (2013). Growth for the advanced economies is forecast to be above 2% by 2010, with even higher growth of between 2.5% to 3% between 2011 and 2013.

Bottom Line: If the IMF forecast is accurate, the current global economic slowdown will produce only one year of below-average world output growth (2.2% in 2009), which will follow six years of strong world economic growth above the 3.46% post-1980 average (see chart), and an above-average expansion of the world economy will resume in 2010 with at least four years of real GDP growth close to 5%. Moreover, if the IMF is correct, the predicted global economic slowdown of 2009 will be roughly equivalent to the world slowdown in 2001, and much less severe than the slowdowns in 1990-1991 and 1980-1982.