UN forecasts lower global economic growth for 2022 and 2023

New York, Jan. 15 (BNA) On Thursday, the United Nations expected a decline in global economic growth for 2022 and 2023, saying that the world faces new waves of coronavirus infections, persistent challenges in the labor market, persistent supply chain issues, and increasing inflationary pressures.

The United Nations said that after expanding by 5.5% in 2021 – the highest rate of global economic growth in more than four decades – the global economy is expected to grow only 4% in 2022 and 3.5% in 2023, according to the Associated Press ( AP) reported.

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

“At the beginning of 2022, the global economic picture in the market is still murky,” he said. “Job creation has not yet made up for early losses with the employment deficit disproportionately affecting women and youth. Meanwhile, the spread of the novel COVID-19 virus, supply challenges, rapidly rising inflation in many parts of the world, and debt challenges that Looming, all factors looming hazy over the economic outlook.”

Last year’s strong recovery was largely driven by consumer spending, some increase in investment and trade in goods that exceeded levels prior to the COVID-19 pandemic, according to the United Nations’ Global Economic Situation and Outlook for 2022.

But growth momentum “slowed significantly by the end of 2021, including in large economies, such as China, the European Union and the United States” as the effects of monetary and fiscal stimuli from the pandemic began to wane and major disruptions to the supply chain emerged, the report said.

The forecasts of the United Nations are similar to those of the World Bank. Released on Tuesday.

The 189-nation global financial institution that 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% it forecast last June. It blamed the ongoing COVID-19 outbreak, reduced government economic support and ongoing bottlenecks in global supply chains.

The UN report said labor shortages in advanced economies were adding to supply chain challenges and inflationary pressures, and growth in most developing and transition economies was generally weaker.

While rising commodity prices have helped countries that depend on commodity exports, rising food and energy prices have triggered rapid inflation, particularly in the nine-member Commonwealth of Independent States, which was formed after the dissolution of the Soviet Union in 1991, and in Latin America and the Caribbean, the United Nations said.

“Recovery has been particularly slow in tourism-dependent economies, particularly in small island developing states,” she added.

Hamid Rashid, head of the United Nations Global Economic Monitoring Branch, said at the press conference that the United Nations’ forecasts for global economic growth depend on several assumptions.

“One of the assumptions is that the vaccination progress that we are making will continue, and there will be no more major disruptions, or pandemic-related disruptions again in the near term, in the next few quarters,” he said, “and of course, there will be no major surprises in monetary policy positions.” adopted in advanced economies.

Looking beyond the GDP numbers, Rashid said, the world has to take into account the growing poverty and inequality in developed countries but mostly in developing countries. He described it as worrying because 64 million people lived in extreme poverty in 2022 compared to 2019, before the pandemic.

“Now is the time to bridge inequality gaps within and between countries,” said UN Secretary-General António Guterres.

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

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