The UN predicts lower global economic growth for 2022 and 2023

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The United Nations on Thursday forecast lower global economic growth for 2022 and 2023, saying the world is facing new waves of coronavirus infections, persistent labor market challenges, long-standing supply chain problems and rising inflationary pressures.

According to the UN, the world economy is expected to grow by only 4% in 2022 and 3.5% in 2023 after 5.5% growth in 2021 – the highest level of global economic growth in more than four decades.

Liu Zhenmin, the UN Under-Secretary-General for Economic and Social Affairs, told a news conference announcing the economic report that two years after the start of the COVID-19 pandemic, “we are still living in a time of great uncertainty.”

“In early 2022, the global economic picture in the market is still unclear,” he said. “Job creation has not yet made up for the first losses, as the employment deficit disproportionately affects women and youth. At the same time, the spread of the new COVID-19 virus, supply challenges, rapidly rising inflation in many parts of the world and looming debt challenges are clouding the economic outlook.

Last year’s strong recovery was largely due to consumer spending, a certain increase in investment and trade in goods that exceeded the pre-COVID-19 pandemic level, according to a UN report on the World Economic Situation and Outlook for 2022.

But the momentum of growth has “slowed down considerably by the end of 2021, even in large economies such as e.g. China the European Union and the United States “, the report said, as the effects of monetary and financial stimulus from the pandemic began to abate and major disruptions in the supply chain emerged.

The United Nations forecast is similar to the World Bank forecast. published on Tuesday.

The 189-world global financial institution, which provides loans and grants to low- and middle-income countries, has lowered its forecast for global economic growth to 4.1% this year from 4.3% growth forecast last June. It is to blame for the constant outbreaks of COVID-19, declining government economic support and persistent bottlenecks in global supply chains.

The UN report states that labor shortages in developed economies are increasing supply chain challenges and inflationary pressures, while growth in most developing and transition economies has been generally weaker.

While higher commodity prices have helped countries dependent on commodity exports, rising food and energy prices have triggered rapid inflation, especially in the nine-nation Commonwealth of Independent States since the collapse of the Soviet Union in 1991 and in Latin America and the Caribbean. , the UN said.

“Recovery has been particularly slow in tourism-dependent economies, especially in small island developing countries,” it said.

Hamid Rashid, head of the UN Office for Global Economic Monitoring, told a news conference that the UN’s forecasts for global economic growth depend on several assumptions.

“One assumption is that the progress we have made in vaccination will continue so that in the near future, in the next few quarters, there will be no more major disruptions or pandemic-related disruptions,” he said. there will be bigger surprises with the monetary policy stance we have in developed economies. “

Rashid said the world needs to take into account growing poverty and inequality in developed countries, and mostly in developing countries, if we look beyond GDP figures. He called it worrying that 64 million more people live in extreme poverty in 2022 than in 2019, before the pandemic.

UN Secretary General Antonio Guterres he said: “Now is the time to fill the gaps in inequality within and between countries.”

“If we work in solidarity – as one human family – we can make 2022 a real year of recovery for both people and economies,” he said.

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