The Global Economy Is Entering A Phase of Pronounced Slowdown: The Latest Global Economic Prospects Report

In its latest “Global Economic Prospects” report, The World Bank slashed its global growth forecast and has cautioned that a rise in inflation, debt, and income inequality could jeopardize the recovery in emerging and developing economies. The latest report sees global economic growth downshifting from 5.5 percent in 2021 to 4.1 percent in 2022, an outlook that is more pessimistic than its June call for 4.3 percent growth this year. Throughout the pandemic, the bank has raised the alarm about growing levels of inequality both within and between nations, and its latest outlook is no exception.
According to the report, major economies including the United States, China, and countries in the eurozone are expected to slow down this year. It added that a resurgence in Covid infections, due to the highly contagious omicron variant, will likely disrupt economic activity in the near term and could worsen growth projections if it persists.
The coronavirus pandemic has worsened income inequality. It referred to data that showed 60% of households surveyed in EMDEs experienced a loss of income in 2020, while those in low-income countries and sub-Saharan Africa were hit the hardest. The World Bank also continues to press for accelerated debt relief efforts to help low-income countries that are under stress. The World Bank and the World Health Organization, have advocated for more widespread and equal distribution of vaccines to keep the pandemic under control. Because if not controlled timely, it would further bring long-term problems.

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