World Bank Cuts Global Growth Forecast to 2.9%

The World Bank has cut the global growth forecast by 1.2 percentage points to 2.9% for 2022, warning that Russia-Ukraine war has compounded the damage from the Covid-19 pandemic, with many nations likely to face recession, according to a Reuters report.

The Russian's invasion of Ukraine had magnified the slowdown in the global economy, which was now entering what could become "a protracted period of feeble growth and elevated inflation," the World Bank said in its Global Economic Prospects report, added the Reuters report.

World Bank President David Malpass said global growth was being hammered by the war, fresh COVID-19 lockdowns in China, supply-chain disruptions and the risk of stagflation, a period of weak growth and high inflation last seen in the 1970s.
"The danger of stagflation is considerable today," Malpass wrote in the foreword to the report.

"Subdued growth will likely persist throughout the decade because of weak investment in most of the world. With inflation now running at multi-decade highs in many countries and supply expected to grow slowly, there is a risk that inflation will remain higher for longer," as per the Reuters report.

Between 2021 and 2024, the pace of global growth is projected to slow by 2.7 percentage points, Malpass said, more than twice the deceleration seen between 1976 and 1979.