The ongoing trade war between the USA and China could start having material effects on the economies of both countries within the coming years, according to new projections from the International Monetary Fund (IMF).
The worldwide organisation downgraded its predictions for global growth this week, and is now forecasting 3.7 percent global growth in both 2018 and 2019.
The Fund says the global economy's growth target has dropped by 2 percent from the initial 3.9 percent.
And the last one was contracted in 2013 when the PML-N government successfully completed the three-year package of $6.4 billion in August 2016, which was 216 percent of Pakistan's quota at the International Monetary Fund.
Finance Minister Asad Umar left for Indonesia on Monday night to participate in the annual meetings of the International Monetary Fund and World Bank at Bali, scheduled to run until October 12, and formally request a bailout programme, reports Dawn news. The U.S. economy is expected to grow 2.5 percent in 2019.
The rapid build-up in debt in China in recent years also is a concern, although Chinese authorities have taken steps to rein in debt growth, he said.
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The IMF said the high downside risks in the medium-term are driven by relatively elevated United States interest rates, a strong USA dollar and a strong global risk appetite, which "tends to boost portfolio flows in the near term but foreshadows weaker inflows in the medium term".
Consumer prices in Iran, which rose by 9.6 percent in 2017, are now projected to jump by 29.6 percent this year, and by 34.1 percent next year, the IMF's estimates show.
It cited USA tariffs on solar panels, washing machines, steel and aluminum, in addition to retaliation by trade partners, as potentially depressing factors.
The IMF expects SA's economy to expand by 1.4% in 2019, down from its April projection of 1.7%. The group recently downgraded global growth forecasts. It was trading at 6.93 to the dollar in the offshore market on Thursday morning, after the People's Bank of China, the country's central bank, set the midpoint of the currency's daily trading range at 6.9098.
Conditions in Europe and other major advanced economies have also remained "relatively easy", although investors have pushed back their expectations for the European Central Bank to lift interest rates, the report said.
"Where we are now is we've gotten some bad news. But we need to do it (go to IMF) before our reforms start yielding results in about six months", Khan said.
China's economy is also showing signs of moderating and that could be exacerbated by its trade disputes with the United States, which has imposed tariffs on $250 billion worth of imports from Beijing and is threatening duties on $267 billion more.