World Bank: The Global Economic Outlook in three charts

Pedestrians wearing face masks as a precaution against the spread of the coronavirus disease (COVID-19), walk next to a sculpture of the world in a public park in Vina del Mar, Chile April 11, 2020. REUTERS/Rodrigo Garrido
Eltrak - Cat banner ad

After rebounding to an estimated 5.5 percent in 2021, global growth is expected to decelerate markedly in 2022 to 4.1 percent, reflecting continued COVID-19 flare-ups, diminished fiscal support, and lingering supply bottlenecks.

Although output and investment in advanced economies are projected to return to pre-pandemic trends next year, they will remain below in emerging market and developing economies (EMDEs), owing to lower vaccination rates, tighter fiscal and monetary policies, and more persistent scarring from the pandemic.

Stonetech banner ad
Stonetech banner ad
Officine Marchetti banner ad

Various downside risks cloud the outlook, including simultaneous Omicron-driven economic disruptions, further supply bottlenecks, a de-anchoring of inflation expectations, financial stress, climate-related disasters, and a weakening of long-term growth drivers. Because EMDEs have limited policy space to provide additional support if needed, these downside risks heighten the possibility of a hard landing.

This underscores the importance of strengthening global cooperation to foster rapid and equitable vaccine distribution, calibrate health and economic policies, enhance debt sustainability in the poorest countries, and tackle the mounting costs of climate change.

1. Global growth is projected to decelerate in 2022 and 2023

Source: World Bank. Note: Figure shows the contribution to global growth forecasts over 2021-23, while the first bar shows the average contribution to growth in the 2015-19 period. Aggregates are calculated using real U.S. dollar GDP weights at average 2010-19 prices and market exchange rates. Shaded area indicates forecasts.

2. EMDEs are projected to experience a weaker recovery than advanced economies

Source: World Bank. Note: EMDEs = emerging market and developing economies. Figure shows the percent deviation between the latest projections and forecasts released in the January 2020 edition of the Global Economic Prospects report. For 2023, the January 2020 baseline is extended using projected growth for 2022. Aggregates are calculated using real U.S. dollar GDP weights at average 2010-19 prices and market exchange rates. Shaded area indicates forecasts.

3. After surprising to the upside in 2021, global inflation is expected to remain elevated this year

Sources: Consensus Economics; World Bank. Note: Figure shows the Consensus forecast for median headline CPI inflation for 2021-22 based on December 2021 and May 2021 surveys of 32 advanced economies and 50 EMDEs. Shaded area indicates forecasts.

Source: www.hellenicshippingnews.com