World Trade Organization (WTO) Director-General Ngozi Okonjo-Iweala has given a rather gloomy outlook on the global economy. In her opening statement at WTO’s annual public forum in Geneva, Okonjo-Iweala stated that the world may be ‘edging’ into recession.
Her views echoed the similar warning some days ago by World Bank. The global lender on Tuesday also slashed growth prospects for Asia, citing concerns about slowdown in China.
“Now we have to weather what looks like an oncoming recession. I think a global recession. That’s what I think we are edging into. But at the same time, we have to start thinking of the recovery. We have to restore growth,” said the WTO chief.
With most central banks across the globe taking a hawkish approach and hiking the interest rates to beat inflation, the former Nigerian finance and foreign minister said the banks were in a tough spot.
“Central banks don’t really have too much of a choice but to tighten and increase interest rates but the repercussions on emerging markets and developing countries is quite severe, because they too are tightening an increase in interest rates,” she said.
Her statement comes less than two weeks after World Bank also provided a similar assessment. As reported by WION, World Bank President David Malpass gave a bearish outlook. “Global growth is slowing sharply, with further slowing likely as more countries fall into recession,” said Malpass, adding that these trends would persist, with devastating consequences for emerging market and developing economies.
Read more: Global economy in steepest slowdown, may be edging towards recession, warns World Bank
On Tuesday, World Bank said economies in Asia-Pacific are projected to grow 3.2 per cent in 2022, down from a five per cent forecast in April. It cited China’s Covid lockdowns that disrupt factories and dampen spending as a reason.
Most global currencies, bar the US dollar have depreciated steeply. The economic recovery that was presumed to take place in the aftermath of a global pandemic has been brought to a screeching halt due to Russia’s invasion of Ukraine.
The entire continent of Europe is scurrying around to gather fuel as the winter season approaches while America battles inflation that has broken records, set more than 40 years ago.
(With inputs from agencies)
WATCH WION LIVE HERE:
