World Bank forecasts slow global growth till 2023, cites new COVID-19 variants
The World Bank says despite a strong rebound in 2021, the global economy is entering a “pronounced slowdown” due to fresh threats from COVID-19.
Other factors are the rise in inflation, debt and income inequality capable of endangering the recovery in emerging and developing economies.
The World Bank, led by David Malpass, released its Global Economic Prospects report on Tuesday.
The report says global growth is expected to decelerate markedly from 5.5 percent in 2021 to 4.1 percent in 2022.
For 2023, the year will dally by 3.2 percent as pent-up demand dissipates, and as fiscal and monetary support is unwound across the world.
The institution found that the rapid spread of Omicron indicates that the pandemic will likely continue to disrupt economic activity.
“In addition, a notable deceleration in major economies—including the United States and China—will weigh on external demand in emerging and developing economies”, the report noted.
The World Bank warns that with developing economies lacking the policy space to support activity, new COVID-19 outbreaks, supply-chain bottlenecks, inflationary pressures and financial vulnerabilities may increase the risk of a hard landing.
“The world economy is simultaneously facing COVID-19, inflation, and policy uncertainty, with government spending and monetary policies in uncharted territory.
“Rising inequality and security challenges are particularly harmful for developing countries.
“Putting more countries on a favorable growth path requires concerted international action and a comprehensive set of national policy responses”, said President David Malpass.
The World Bank forecast came days after the discovery of Deltacron in Cyprus by a researcher and his team.
Leondios Kostrikis, Professor of Biological Sciences at the University of Cyprus, said the new strain is a combination of delta and omicron.
Weeks earlier, IHU, also a new variant, was detected in France. Dozens of cases were reported near the South of Marseille.
The index case was a fully-vaccinated man who returned from a visit to Cameroon in November 2021. The country shares border with Nigeria.
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