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US fiscal deficit to increase risk in global economy: IMF report

China

US fiscal deficit to increase risk in global economy: IMF report
China

China

US fiscal deficit to increase risk in global economy: IMF report

2024-04-21 21:27 Last Updated At:21:37

The huge fiscal deficit of the United States is exacerbating inflation and posing significant risks to the global economy, said a report released earlier this week by the International Monetary Fund (IMF).

Financial Times recently reported that the IMF's latest Fiscal Monitor Report, released on April 17, shows that the U.S. fiscal deficit is expected to reach 7.1 percent of its gross domestic product (GDP) next year, while the average level of other developed economies is around 2 percent.

The Financial Times quoted the IMF report as saying that large-scale U.S. spending could have a profound impact on the global economy and pose risks to other economies. Therefore, the United States urgently needs to solve the serious imbalance between expenditure and revenue.

IMF data shows that last year, the fiscal deficits of developed economies such as the euro zone were under control, yet the United States saw a considerable fiscal decline, with the deficit accounting for 8.8 percent of its GDP, more than twice the level in 2022. The U.S. Treasury Department’s daily report on Dec 29 last year showed that the federal government's debt exceeded 34 trillion U.S. dollars.

Pierre-Olivier Gourinchas, economic counselor and director of research of the IMF, said the U.S. fiscal situation is particularly worrying, and complicates the Fed's response to high inflation. In the long term, this will increase fiscal and financial risks to the global economy, he said.

As U.S. borrowing costs are closely tied to global markets, the IMF noted that a sudden and sharp rise in U.S. interest rates would lead to a surge in global government bond yields, along with fluctuation in the currency exchange rates in emerging markets and developing economies.

US fiscal deficit to increase risk in global economy: IMF report

US fiscal deficit to increase risk in global economy: IMF report

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Displaced Gazans receive tents donated by China

2024-05-21 15:45 Last Updated At:16:07

To ease the dire humanitarian situation in Gaza, the Chinese government has continued to provide aid to Palestine and has sent several batches of food, medicine and other emergency humanitarian aid to the strip through Egypt.

Two batches of humanitarian supplies provided by the Chinese government to Palestinians arrived at the Al-Arish Airport and Port Said in Egypt on Saturday and Sunday. The shipments, including tents, blankets, clothing, medical supplies and flour, will be transported to the Gaza Strip through the Rafah border crossing.

Jawad Abu Shakra, a displaced resident, and his family were displaced in Rafah city when they received a tent donated by China before.

"We were displaced in Rafah and after the difficult circumstances, we received a tent donated by China. We received it after quite a bit of trouble because there are a lot of people in need of tents. But after great efforts and trouble, we got in contact with an organization and we got a tent. It doesn’t leak when it’s raining, and it probably has seven windows so you’re not affected much by the heat. We returned to Khan Younis, thank Allah," he said.

As the crossings are all closed, he told China Global Television Network (CGTN) that his life is in a tight situation where necessities have become even more expensive.

"We’re in a tight situation, and people’s needs are not little. I mean, as you can see, everything has become expensive, expensive, expensive. And the crossings are all closed, so the Gaza Strip officially needs a lot of aid," Shakra said.

Displaced Gazans receive tents donated by China

Displaced Gazans receive tents donated by China

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