WASHINGTON : The global economy is likely slowing sharply this year, hobbled by high interest rates, the repercussions of Russia’s invasion of Ukraine and the lingering effects of the coronavirus pandemic.
That’s the latest outlook of the World Bank, a 189-country anti-poverty agency, which estimates that the international economy will expand just 2.1% in 2023 after growing 3.1% in 2022.
Speaking to reporters Tuesday, Indermit Gill, the World Bank’s chief economist, called the latest findings “another gloomy report.” The bank, he said, expects “last year’s sharp and synchronized slowdown to continue to this year into a sharp slowdown.”
“By the end of next year, a third of the developing world will not meet the per-capita income level that they had at the end of 2019,” he said.
Still, the bank’s latest Global Economic Prospects report marks an upgrade from its previous forecast in January. That estimate had envisioned worldwide growth of just 1.7% this year.
The World Bank upgraded its 2023 outlook for China after Beijing late last year relaxed its draconian zero-COVID policies, which had restricted travel and hammered its economy. The world’s second-biggest economy is now expected to grow 5.6% in 2023, up from 3% last year. The World Bank envisions Japan’s growth decelerating to 0.8% this year from 1% in 2022. It foresees India’s growth slowing to a still-strong 6.3% from 7.2% last year.
