The World Bank cut its global growth forecast by 1.2 percentage points to 2.9 percent for 2022, warning that the Russian conflict in Ukraine has exacerbated the damage done by the COVID-19 pandemic and could potentially push many countries into recession.
The World Bank, in its Global Economic Prospects report, stated that “the global economy will witness the strongest post-recovery slowdown in more than eighty years. This leads to an increased risk of stagflation.”
World Bank President David Malpass said that “Global growth has been affected by the war, new shutdowns due to the Covid-19 virus in China, disruptions in supply chains and the threat of stagflation, a period of weak growth and high inflation that is observed in the world. was a witness.” The last time was in the seventies.
“The risk of inflation is accompanied by severe stagnation today … and weak growth is likely to continue for a decade due to weak investment in most parts of the world,” Malpass explained.
“Given that inflation in many countries is now at multi-decade highs and supply is expected to grow slowly, there is a risk that inflation will remain high for much longer,” he added.
“Global growth is expected to slow down by 2.7 percentage points between 2021 and 2024, more than double the slowdown seen between 1976 and 1979,” he said.
Source: El Iktisad
