The International Monetary Fund expected that next year will witness an economic recession that will be felt by millions of people around the world.
And if we put aside growth rates during the global crisis and the height of the Corona pandemic, the expected growth rate for next year is the weakest since 2001, according to the World Economic Outlook report published by the International Monetary Fund on Tuesday.
Estimates of global GDP growth for the current year 2022 remained unchanged at 3.2 percent, down from the growth rate recorded in 2021, which amounted to 6 percent.
The report indicated that more than a third of the global economy will experience two consecutive quarters of economic downturn, while the world’s major economies, the United States, the European Union and China will continue to slow.
The report stressed that the war in Ukraine continues to “vigorously destabilize the global economy.” Its effects have caused an “acute” energy crisis in Europe, as well as devastation in Ukraine itself.
The price of natural gas has more than quadrupled since 2021, with Russia now supplying the European continent with gas less than 20 percent of 2021 levels.
Food prices have also risen as a result of the crisis.
The International Monetary Fund expects global inflation to reach its peak in late 2022, rising from 4.7 percent in 2021 to 8.8 percent, noting that it “will remain high for a longer period of time than previously expected.”
Global inflation is likely to fall to 6.5 percent in 2023 and to 4.1 percent by 2024, according to IMF projections.
China also continues to implement the “zero Covid” policy, which causes closures in cities, impeding economic activity in the second largest economy in the world, in addition to the real estate sector crisis in the country, which constitutes a fifth of the Chinese economy.
The IMF report stated that the shocks of 2022 would “reopen the economic wounds” of developing countries and emerging economies, which were partially healed following the Corona epidemic.
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