The IMF’s ‘closure’ warning to the US

The spokesperson for the International Monetary Fund (IMF), Julie Kozack, made assessments on the evolution of the world economy in the press conference she held.

Referring to the risk of a “government shutdown” caused by the lack of agreement on the new budget that will finance the federal government, although there is very little time left for the new fiscal year that will begin on October 1 in the US, Kozack asked parties to come together to find a way forward on government funding and called for consensus.

“We view the shutdown as an avoidable risk to the U.S. economy,” Kozack said. saying.

EVALUATION OF THE CHINESE ECONOMY

Answering questions about the outlook for the Chinese economy, Julie Kozack stated that they have seen a slowdown in the country’s economy since the first quarter.

Kozack said that despite this slowdown, the latest data is a bit more mixed and showing some signs of stability.

Kozack said they still expect the Chinese economy to grow 5 percent this year, and that in the medium term, growth will slow to 3.5 percent due to demographic negativities and slowing productivity growth.

Kozack noted that they believe that if the Chinese economy is given the opportunity to rebalance through reforms, it will be able to achieve higher growth in the medium term.

WHAT DOES “FEDERAL GOVERNMENT SHUTDOWN” MEAN?

Under US law, if Congress is unable to pass the budget for the entire fiscal year, which begins on October 1 and ends on September 30 each year, the period until this happens must be covered by temporary budgets.

During periods when a temporary budget cannot be passed, the federal government, having lost its spending authority, is forced to suspend all activities except vital services.

In this process, while public employees working in non-essential services receive compulsory leave, public employees such as the US military, intelligence agencies, doctors and nurses working in public hospitals, security guards at airports and prisons continue with its functions. These employees, who are in the “essential personnel” category, generally do not receive their salaries during shutdown periods until Congress passes a new budget. (AA)