Despite a strong rebound in 2021, the World Bank says the global economy is entering a “pronounced slowdown” due to new threats from COVID-19.
Other factors that could jeopardize the recovery of emerging and developing economies include rising inflation, debt, and income inequality.
On Tuesday, the World Bank released its Global Economic Prospects report, led by David Malpass.
According to the report, global growth will slow significantly from 5.5 percent in 2021 to 4.1 percent in 2022.
As pent-up demand dissipates and fiscal and monetary support is unwound around the world, 2023 will lag by 3.2 percent.
The rapid spread of Omicron, according to the institution, indicates that the pandemic will continue to disrupt economic activity.
“In addition, a significant slowdown in major economies, such as the United States and China,” the report stated, “will weigh on external demand in emerging and developing economies.”
New COVID-19 outbreaks, supply-chain bottlenecks, inflationary pressures, and financial vulnerabilities, according to the World Bank, may increase the risk of a hard landing because developing economies lack the policy space to support activity.
“The world economy is dealing with COVID-19, inflation, and policy uncertainty at the same time, with government spending and monetary policies treading new ground.
“Developing countries are particularly harmed by rising inequality and security challenges.
President David Malpass stated, “Putting more countries on a favorable growth path requires concerted international action and a comprehensive set of national policy responses.”
The World Bank’s prediction came just days after a researcher and his team discovered Deltacron in Cyprus.
The new strain is a hybrid of delta and omicron, according to Leondios Kostrikis, Professor of Biological Sciences at the University of Cyprus.
IHU, a new variant, had been discovered in France a few weeks before. A slew of cases have been reported near Marseille’s south end.
In November 2021, the index case was a fully vaccinated man who returned from a trip to Cameroon. Nigeria shares a border with the country.