This is the video of my comment in Press TV News 19-7-2016 on IMF’s recent update of World Economic Outlook (WEO) report
The main points are the following:
IMF has cut its projection for world economy’s growth in 2017. One of the main reasons offered for this cut is Brexit.
This report is another proof of IMF’s cunningness. IMF is a shrewd organisation that serves predominanty the US and Western imperialist interests but at the same time tries to show a respectable face. Thus, it does not want to be grossly disproved by facts as it already has such a dismal record (that is it has erred considerably in the past in its forecasts).
Now, the IMF tries to foment positive expectations about the future course of the world economy. This attitude follows from the Mainstream economics’ mandra about expectations being the main driver of the economy. In other words that if economic agents have positive expectations about the future then the world economy would fare better. Of course this is ‘bullshit economics’.
On the other hand, IMF fears a ‘triple dip’ after the global economic crisis of 2007-8 but does not want to admit it openly. The world economy is still in shambles as the main structural reasons behind the crisis has not disappeared. They have just been pushed under the carpet. So the IMF takes a guarded position.
However, IMF’s argument about the Brexit is pretty ideologically-driven. IMF was against Brexit and now, after the referendum, wants to portay this move as a negative one in order to discourage any other similar move. But IMF’s projection is simply an artefact. There is nothing materially significant in the current situation that we can measure so as to make a verdict about the negative impact of Brexit. It is indicative that before the referendum IMF trumpeted that Brexit would trigger a UK recession. However now it expects UK to grow by 1.7 % this year and 1.3% next year. That is weaker than the 1.9 and 2.2 per cent growth forecasts before the referendum, but the UK is still set to be the second-fastest growing economy in the Group of Seven industrialised nations this year – behind the United States – and third-fastest next year, behind the US and Canada.
So IMF’s argument is simply a political facade.