[ad_1]
After a sharp recovery in 2021 from the depths of the pandemic, the global economy is expected to grow by 3% in 2022 and a slower 2.4% growth this year after falling to 2.6% last year, central banks said in their annual report. stated in the economic report. Outlook report. These rates are below his 10-year average of 3.1 percent in the 2010s.
The continued economic slowdown makes it almost certain that world leaders will not be able to meet the 2030 development goals agreed in 2015 by 193 United Nations member states, including the United States. Governments have pledged to transform the global economy by the end of this decade. It has 17 ambitious goals, including ending extreme poverty, cutting greenhouse gas emissions by almost half, improving education for the poor and eradicating hunger.
This measure was not legally binding. But the plan, introduced at the United Nations with a speech by Pope Francis after three years of negotiations, was seen as packing a moral punch.
“The 2020s so far has been a time of broken promises, with governments around the world falling short of the ‘unprecedented’ targets they promised to achieve by 2020,” Gill said in the report. In the preface, the outlook was described as “dire.”
The bank says that in a quarter of the world’s developing countries, people are now poorer than before the pandemic.
“If you look at the big picture, we’re not happy about it,” said Ayhan Kose, the bank’s deputy chief economist.
Still, the bank praised progress in curbing inflation as supply chain kinks are ironed out and rising borrowing costs dampen business activity. Global inflation is expected to average 3.7% this year, down from 5.3% in 2023.
But prices are likely to continue rising this year at a faster pace than the Federal Reserve and other central banks say is desirable.
“It’s best not to open the champagne yet,” says Kose.
The bank predicts the U.S. will grow at a rate of 1.6% this year, roughly twice as fast as Europe and Japan. China’s growth rate is expected to be 4.5%, down from last year’s estimated 5.2% as the momentum to restart economic activity after the coronavirus pandemic subsides.
In the long run, slowing growth is a problem for developed and middle-income countries alike. One reason for the latter’s poor economic growth is the sharp decline in investment spending, which remains at only half the average rate of the past two decades.
Citing historical examples, the bank said developing countries could accelerate investment booms by implementing policy changes such as expanding trade and capital flows and increasing government budgetary discipline. In 192 episodes since 1950, countries like Chile, Colombia, and Turkey have increased their annual economic growth rates by nearly a third, thanks to soaring spending on new plant and equipment.
During these times, developing countries expanded their economies by about 40% over six years, the report said.
Economists at the bank expect this year to be good, but not great, but warn that conditions are more likely to lead to disappointments than positive surprises. The war in Gaza, combined with ongoing hostilities in Ukraine, could derail global economic growth. Escalating fighting in the Middle East will likely push oil prices well above the current $75 per barrel level, slowing growth and increasing inflation.
Attacks on transport ships passing through the Red Sea led cargo ships to choose a longer and more expensive route around the southern tip of Africa. Trade volumes through the Suez Canal, which connects the Red Sea and the Mediterranean, fell by 28% in the 10 days to January 2, according to the International Monetary Fund.
If disruption to this major shipping route persists, there is a possibility that there will be upward pressure on prices in countries such as the United States.
[ad_2]
Source link
