World Bank slashes global growth forecast to 2.9%
(VOVWORLD) -Compounding the damage from the COVID-19 pandemic, the Russian military operation in Ukraine has magnified the slowdown of the global economy, which is entering what could become a protracted period of feeble growth and elevated inflation, according to the World Bank’s latest Global Economic Prospects report.
 (Photo: Xinhua/ VNA) |
This raises the risk of stagflation, with potentially harmful consequences for middle- and low-income economies alike.
Global growth is expected to slump from 5.7% in 2021 to 2.9% in 2022 – significantly lower than the 4.1% that was anticipated in January.
It is expected to hover around that pace over 2023-24, as the conflict in Ukraine disrupts activity, investment, and trade in the near term, pent-up demand fades, and fiscal and monetary policy accommodation is withdrawn.
As a result of the damage from the pandemic and the war, the level of per capita income in developing economies this year will be nearly 5% below its pre-pandemic trend.