VOI - Voice of Indonesia | RRI - Radio Republik Indonesia

 For much of the global economy, 2023 is going to be a tough year as the main engines of global growth - the United States, Europe and China - all experience weakening activity, the head of the International Monetary Fund said on Sunday.

The new year is going to be "tougher than the year we leave behind," IMF Managing Director Kristalina Georgieva said on the CBS Sunday morning news program "Face the Nation."

"Why? Because the three big economies - the U.S., EU and China - are all slowing down simultaneously," she said.

In October, the IMF cut its outlook for global economic growth in 2023, reflecting the continuing drag from the war in Ukraine as well as inflation pressures and the high interest rates engineered by central banks like the U.S. Federal Reserve aimed at bringing those price pressures to heel.

Since then, China has scrapped its zero-COVID policy and embarked on a chaotic reopening of its economy, though consumers there remain wary as coronavirus cases surge. In his first public comments since the change in policy, President Xi Jinping on Saturday called in a New Year's address for more effort and unity as China enters a "new phase."

"For the first time in 40 years, China's growth in 2022 is likely to be at or below global growth," Georgieva said.

Moreover, a "bushfire" of expected COVID infections there in the months ahead are likely to further hit its economy this year and drag on both regional and global growth, said Georgieva, who traveled to China on IMF business late last month.

"I was in China last week, in a bubble in a city where there is zero COVID," she said. "But that is not going to last once people start traveling."

"For the next couple of months, it would be tough for China, and the impact on Chinese growth would be negative, the impact on the region will be negative, the impact on global growth will be negative," she said.

In October's forecast, the IMF pegged Chinese gross domestic product growth last year at 3.2% - on par with the fund's global outlook for 2022. At that time, it also saw annual growth in China accelerating in 2023 to 4.4% while global activity slowed further.

Her comments, however, suggest another cut to both the China and global growth outlooks may be in the offing later this month when the IMF typically unveils updated forecasts during the World Economic Forum in Davos, Switzerland.

U.S. ECONOMY 'MOST RESILIENT'

Meanwhile, Georgieva said, the U.S. economy is standing apart and may avoid the outright contraction that is likely to afflict as much as a third of the world's economies.

The "U.S. is most resilient," she said, and it "may avoid recession. We see the labor market remaining quite strong."

But that fact on its own presents a risk because it may hamper the progress the Fed needs to make in bringing U.S. inflation back to its targeted level from the highest levels in four decades touched last year. Inflation showed signs of having passed its peak as 2022 ended, but by the Fed's preferred measure, it remains nearly three times its 2% target.

"This is ... a mixed blessing because if the labor market is very strong, the Fed may have to keep interest rates tighter for longer to bring inflation down," Georgieva said.

Last year, in the most aggressive policy tightening since the early 1980s, the Fed lifted its benchmark policy rate from near zero in March to the current range of 4.25% to 4.50%, and Fed officials last month projected it will breach the 5% mark in 2023, a level not seen since 2007.

Indeed, the U.S. job market will be a central focus for Fed officials who would like to see demand for labor slacken to help undercut price pressures. The first week of the new year brings a raft of key data on the employment front, including Friday's monthly nonfarm payrolls report, which is expected to show the U.S. economy minted another 200,000 jobs in December and the jobless rate remained at 3.7% - near the lowest since the 1960s. (Reuters)

Brazil's new finance minister, Fernando Haddad, said on Monday he would propose a new fiscal anchor in the first half of this year as leftist President Luiz Inacio Lula da Silva's team works to "restore" public accounts.

"We are not here for adventures," he said, seeking to calm market jitters over the return of Lula.

A former mayor of Sao Paulo, Haddad took office with the challenge of presenting a credible fiscal framework after Congress passed a package increasing Brazil's spending cap to ramp up social expenditures.

In his first speech in office, Haddad said the government would not accept the "absurd" 220 billion-real ($41.19 billion) primary deficit forecast in this year's budget, indicating it will work to reduce it.

He pledged to fight inflation, promising to send to Congress the proposal for a new fiscal anchor in the first half of the year seeking to ensure public debt sustainability.

But he did not mention Lula's decision the day before to extend a costly tax exemption on fuels, in what some saw as a striking political setback for the new minister.

Prior to taking office, Haddad had stated that the measure - which has an annual impact of 52.9 billion reais - would not be extended.

Speaking to journalists after the event, he said Lula asked for an extension so that a decision on resuming fuel taxes could be taken once the new board of state-owned oil company Petrobras (PETR4.SA) is installed. The taxes boost federal revenue but harm Lula's popularity.

A lawyer with a master's degree in economics and a doctorate in philosophy, Haddad has been viewed with distrust by the market for fear of uncontrolled spending.

He sought to dispel these concerns on Monday, saying the harmonization of fiscal and monetary policy would happen "for sure." Haddad said he will also try to democratize access to credit and establish a more transparent tax system. (reuters)

Mexican authorities said on Sunday at least 14 people died in an armed attack at a prison in the northern border city Juarez and two more died during a later armed aggression elsewhere in the city.

The Chihuahua state prosecutor said in a statement that among those who died in the prison attack were 10 security personnel and four inmates, while another 13 were hurt and at least 24 escaped.

It was not immediately clear who carried out the attack.

The prosecutor said initial investigations found the attackers arrived at around 7 a.m. local time at the prison in armored vehicles and opened fire.

Minutes earlier, authorities had reported a nearby attack against municipal police. After a chase, four men were captured and a truck seized.

In a different part of the city, two more drivers died later in the day following what authorities called an armed aggression.

The state prosecutor did not specify whether the three incidents were related.

In August, hundreds of Mexican soldiers were sent to Juarez after a prison face-off between members of two rival cartels caused a riot and shootouts that killed 11 people, most of them civilians. (Reuters)

Taiwan President Tsai Ing-wen will send a special envoy to attend this week's funeral of former Pope Benedict, with her office saying it is a demonstration of the "deep friendship" between Taiwan and the Vatican, which has been courting China.

Benedict, the first pontiff in 600 years to resign and a standard bearer for conservatives who yearned for a more traditional Church, died on Saturday. His funeral will be held on Thursday.

The Vatican is Chinese-claimed Taiwan's sole European diplomatic ally, and Taipei has watched with concern as Pope Francis has moved to improve relations with China. The democratically governed island has formal ties with only 14 countries, largely due to Chinese pressure.

In a statement late on Saturday, Taiwan's presidential office said Tsai has appointed former Vice President Chen Chien-jen, a devout Catholic, as her special envoy to the funeral "based on the deep friendship between our country and the Vatican".

Chen went to the Vatican three times while in office, in 2016, 2018 and 2019, including attending the canonisation ceremony of Mother Teresa.

In September, while visiting the Vatican for the beatification of former Pope John Paul I, also as Tsai's envoy, Chen met Pope Francis and asked him to "pray for Taiwan". (Reuters)