WASHINGTON: The World Bank is slashing its forecast for global economic growth this year, citing the war in Ukraine, inflation and the lingering effects of the pandemic.
The World Bank now expects the global economy to grow at a rate of 3.2 percent in 2022, down from its previous estimate of 4.1 percent, its president, David Malpass, said on Monday morning. The World Bank estimated that the global economy grew 5.7 percent last year.
The updated projection comes as policymakers from around the world head to Washington this week for the spring meetings of the World Bank and the International Monetary Fund.
“We begin this spring meeting facing severe overlapping crisis,” Malpass told reporters during a briefing. “There’s Covid, inflation and Russia’s invasion of Ukraine.”
Malpass said that these forces were expected to drive up global poverty rates as the world copes with sudden increases in prices of energy, fertilizer and food. Rising interest rates are expected to slow growth and exacerbate inequality, he said.
The World Bank is predicting a sharp contraction in the economies of Russia and Ukraine, and Malpass said that nearby countries in Europe and Central Asia would feel the effects. Consumers in advanced economies are expected to reduce their spending this year as gasoline prices rise.
The I.M.F. is scheduled to release its World Economic Outlook on Tuesday.
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