MercoPress. South Atlantic News Agency

“Smaller China and India” makes IMF lower 2007 global growth

The International Monetary Fund said this week it had lowered its 2007 global growth estimate by one-half percentage point after recent data showed economies of China and India were smaller than previously thought.

The IMF now estimates that last year's global economic growth was 4.7%, down from the 5.2% figure it gave in October when it released its World Economic Outlook. Regarding this year's forecast the IMF has said that the prolonged U.S. housing slump and financial market gyrations, as well as steep energy prices, were taking a bigger toll on economic growth. China and India accounted for the bulk of the reduction in the 2007 growth estimate. China's share of global output in 2007 is now estimated at 10.9%, down from 15.8% previously. India's share declined to 4.6% from 6.4%. Meanwhile, the share of U.S. in global GDP was revised up to 21.4% from 19.3%. The revisions come less than one month after the IMF sister organization, the World Bank, released data showing that the economies of China and India were much smaller than previously thought when measured by buying power in U.S. dollars, also known as purchasing power parity, or PPP. Even after the revisions, China still ranked as the world's second largest economy, and India the fourth largest. The IMF said it also cut one-half point from its global growth figures for 2002 through 2006