The World Bank’s World Economic Prospects report, which was released on January 10, 2023, stated that the outlook for the global economy and future economic conditions is dismal.
The global economy is expected to increase by 1.7% in 2023 and 2.7% in 2024, according to the research, which notes that all growth projections for 2023 have been reduced.
A number of unfavorable occurrences that might plunge the global economy into a deep recession were also mentioned by the World Bank.
A World Bank report calls for increased investment and climate change action to counteract negative economic shocks.
The World Bank, a financial institution with 174 member nations, published its report on Tuesday titled “Global Economic Prospects.”
A “sharp, long-lasting slowdown to hit emerging countries hard” is what the research predicts. The Covid-19 pandemic and “escalating geopolitical tensions,” among other problems ailing the world economy, are only two of the many reasons why a recession can break out, according to the World Bank.
The Covid-19 outbreak and the European conflict between Ukraine and Russia, for example, might cause supply interruptions, the World Bank cautions, and inflation will likely continue to plague global economies.
Slowdowns of this magnitude have predicted worldwide recessions for the previous 20 years, according to the World Bank’s Global Economic Prospects report.
“Growth in the United States is anticipated to decline to 0.5% in 2023, which is 1.9 percentage points below earlier projections and represents the lowest performance outside of declared recessions since 1970.
4.3% growth in China is predicted for 2023, which is a 0.9 percentage point decline from prior projections.
According to the report’s executive summary, one way to benefit the world economy is through enhancing “long-term economic prospects by increasing resilience to climate change.” Policymakers must “address climate change and support people affected by crises and famine,” the World Bank maintains. According to the World Bank research, emerging markets and developing economies would need to “significantly increase investment” in order to “balance the long-term harm from the unfavorable shocks of the last three years.”