The World Bank is concerned that “new negative shocks” could push the global economy into recession this year, with small countries particularly vulnerable, Bloomberg reports.

The warning is included in the semi-annual Global Economic Prospects report, which will be published on Tuesday.

Even in the absence of another crisis, global economic growth is expected to slow significantly this year, simultaneously reflecting a tightening of monetary policy to counter high inflation, worsening financial conditions and ongoing disruptions caused by Russia’s invasion of Ukraine. “, the report says.

“Urgent global and national efforts” are needed to mitigate the risks associated with the slowdown in economic activity and the debt burden facing emerging markets and developing economies (EMDEs), where it is expected that investment growth will remain below the average of the last two decades. , warned in a Washington financial institution.

“It is important that authorities in market and developing countries ensure that any fiscal support is focused on vulnerable groups so that inflation expectations remain well anchored and the financial system remains resilient,” the World Bank notes. .

Similar calls have been made by central bank governors around the world as interest rates are raised aggressively to ease price pressures and governments support businesses and households by keeping energy costs under control.

International Monetary Fund (IMF) Director General Kristalina Georgieva has kicked off 2023 by warning that the world is in for “a tough year, tougher than the year we left behind.”

A third of the world economy will be in recession because the US, the European Union (EU) and China are simultaneously slowing down, the head of the IMF said on January 1. (Source Agerpres)