World Bank projects global economy to only grow 1.7% in 2023

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economy
Illustration (Source: Bareksa)

Jakarta, IO – The World Bank predicts that the global economy will experience the most significant weakening in three decades, approaching a recession with an estimated growth of only 1.7 percent in 2023.

This is significantly lower than previous projection of 3 percent. In 2024, it is expected to grow by of 2.7 percent. If the prediction comes true, the slowing economic growth will widen the recession gap again.

According to World Bank, the major challenges facing the global economy in 2023 are the Ukraine war, high interest rates and global uncertainty. In addition, the Covid-19 pandemic has also had the biggest impact globally since 2020.

“Given the fragile economy, any new adverse developments such as higher-than-expected inflation, a sudden increase in interest rates, a resurgence of the Covid-19 pandemic or escalating geopolitical tensions, could push the global economy into recession,” said World Bank president David Malpass.

Read: State budget deficit reaches 2.38% in 2022

According to Malpass, there are steps to address these challenges, including encouraging more investment to create jobs, increasing production, accelerating the transition to low-carbon energy and strengthening international trade. (bp)