The World Bank (WB) has cut its global growth projection for this year from 4.1% to 2.9%, warning that many countries are likely to face recession.
“Amid the war in Ukraine, surging inflation, and rising interest rates, global economic growth is expected to slump in 2022,” the Tuesday WB press release said.
Below-average Growth
“Several years of above-average inflation and below-average growth are now likely, with potentially destabilizing consequences for low- and middle-income economies. It’s a phenomenon – stagflation – that the world has not seen since the 1970s.”
According to the report, both rich and poor countries would be hit by the growth slowdown, but developing and emerging market economies are the most vulnerable. Growth in advanced economies was forecast to decline from 5.1% to 2.6% this year, while in emerging and developing countries it is expected to drop from 6.6% to 3.4%.
World Economy Is Again In Danger
“Just over two years after Covid-19 caused the deepest global recession since World War II, the world economy is again in danger … Even if a global recession is averted, the pain of stagflation could persist for several years – unless major supply increases are set in motion,” said the report.
08/06/2022