UN economists warned that intersecting crises will further damage the global economy, causing growth to slow from three percent in 2022 to 1.9 percent this year. Apart from the 2007-8 financial crisis and the height of the COVID-19 pandemic, this will be one of the lowest growth rates in recent decades.
“In most countries we expect that private consumption and investment will weaken due to inflation and higher interest rates”, said Ingo Pitterle, Senior Economist at the UN Department of Economic and Social Affairs (UNDESA). “Several countries will see a mild recession before growth is forecast to pick up in the second half of this year and into 2024”.
It comes against the backdrop of the pandemic, the Ukraine war and the resulting food and energy crises, as well as surging inflation and debt tightening. Global growth is forecast to moderately increase to 2.7 percent in 2024, despite gloomy and uncertain economic conditions.
The pace and sequence of further monetary tightening – rising interest rates – the effects of the war in Russia-Ukraine, and the possibility of further disruptions to supply chains, will all influence this outcome. According to the report, the findings also threaten the achievement of the 17 Sustainable Development Goals (SDGs).