The International Monetary Fund on Monday kept its growth forecasts for the world economy unchanged for this year and 2018 at 3.5 per cent and 3.6 per cent respectively.

In an updated World Economic Outlook, the IMF said global gross domestic product growth would remain unchanged from estimates issued in April, although it revised up growth expectations for the eurozone and China.

"While risks around the global growth forecast appear broadly balanced in the near term, they remain skewed to the downside over the medium term," the IMF said in updated forecasts.

The fund said the projected global growth rates for 2017-18, though higher than the 3.2 per cent estimated for 2016, are below pre-crisis averages, especially for most advanced economies and for commodity-exporting emerging and developing economies.

"Among the former, many face excess capacity as well as headwinds to potential growth from aging populations, weak investment, and slowly advancing productivity."

The IMF lowered growth outlook for the Middle East and North Africa predicting slow pace over oil prices as the Saudi economy slides.

The executive board of the fund, which recently concluded the Article IV consultation with the UAE, said the second largest Arab economy's financial buffers, safe-haven status, sound banks and diversified and business-friendly economy are helping it cope with the lower oil price shock. The IMF said in its report that economic activity is expected to strengthen gradually in the coming years with firming oil prices and other global indicators and an easing pace of fiscal consolidation. Non-oil growth is projected to rise to 3.3 per cent in 2017 from 2.7 per cent in 2016, reflecting increased domestic public investment and a pick-up in global trade.

Source: Khaleej Times