President of the World Bank David Malpass issued a warning Tuesday that a global recession is looming on the horizon sometime in the next decade.
Citing the war in Ukraine, continuing inflation, rising global interest rates, and the “devastating” legacy of COVID lockdowns, he projected the world economy to grow just 1.7% this year, down from the 3% predicted in June, according to the BBC.
Malpass, who is married to Daily Caller News Foundation President Adele Malpass, stated that the coming economic downturn would be “broad based,” stifling the growth of individual incomes to a rate slower “than it was during the decade before Covid-19,” the outlet reported.
The World Bank slashed its growth forecasts for most countries and regions, and warned that new shocks could tip the global economy into a recession https://t.co/0KqFexCre0
— Bloomberg (@business) January 10, 2023
International Monetary Fund Managing Director Kristina Georgieva echoed this sentiment in a Jan. 1 interview with “Face The Nation,” warning that 2023 would be “a tough year, tougher than the year we leave behind.”
Georgieva explained to host Margaret Brennan that her less-than-positive outlook was because three of the world’s largest economies — the U.S., E.U. and China — were “all slowing down simultaneously.”
“And that translates into negative trends globally. When we look at the emerging markets in developing economies, there, the picture is even direr. Why? Because, on top of everything else, they get hit by high interest rates and by the appreciation of the dollar. For those economies that have high level of that, this is a devastation,” she stated.
Economists have long been concerned that “higher-than-expected inflation, abrupt rises in interest rates to contain it, a resurgence of the Covid-19 pandemic, or escalating geopolitical tensions could push the global economy into recession,” according to the Telegraph.
“Over the past two decades, slowdowns of this scale have foreshadowed a global recession,” the World Bank warned, adding that it was bracing for “a sharp, long-lasting slowdown,” the BBC reported. (RELATED: Biden Acknowledges It’s Possible A ‘Slight Recession’ Is Coming)
“The crisis facing development is intensifying as the global growth outlook deteriorates. Weakness in growth and business investment will compound the already-devastating reversals in education, health, poverty, and infrastructure and the increasing demands from climate change,” Malpass stated per The Telegraph.
If the projections about an upcoming global recession come true, it would be the first time since World War II that two global recessions have occurred within the same decade, the Telegraph reported.