The World Bank sees a bleak outlook in the global economy in 2022 following the Covid-19 outbreak which continues to weigh on growth, particularly in poor countries.
According to the latest forecast from the World Bank, global growth is forecast to decline significantly to 4.1% from 5.5% in 2021.
This was influenced by the reduction caused by the ongoing Covid-19 threat, the withdrawal of fiscal stimulus and the massive financial support provided at the beginning of the previous pandemic.
However, World Bank President David Malpass said his biggest concern was the possibility of a wide global inequality gap.
This inequality will push, especially poor countries to be more vulnerable to economic damage in an effort to fight inflation.
By 2023, economic activity in all developed countries, such as the United States, the European Zone and Japan, is likely to recover from the damage caused by the Covid-19 outbreak.
Still, production in developing and emerging countries is expected to remain 4% lower than before the pandemic hit.
Even so, the World Bank warns that prolonged inflation, supply chain disruptions and labor issues, as well as a new variant of Covid-19 are likely to dampen global growth.
Meanwhile, the International Monetary Fund (IMF) is also expected to lower its forecast for world economic growth on January 25.
