UN Worlds Economic Situation Report
GS Paper - 3 (Economy)
The United Nations forecast lower global economic growth for 2022 and 2023, saying the world is facing new waves of COVID-19 infections, persistent labour market challenges, lingering supply chain issues and rising inflationary pressures.
- The UN said that after expanding by 5.5 per cent in 2021 -- the highest rate of global economic growth in more than four decades -- the world economy is projected to grow by only 4 per cent in 2022 and 3.5 per cent in 2023.
- Last year's robust recovery was largely driven by consumer spending, some increase in investments and trade in goods surpassing levels before the COVID-19 pandemic, according to the UN World Economic Situation and Prospects 2022 report.
- Without a coordinated and sustained global approach to contain COVID-19 that includes universal access to vaccines, the pandemic will continue to pose the greatest risk to an inclusive and sustainable recovery of the global economy.
- The report said labour shortages in developed economies are adding to supply chain challenges and inflationary pressures.
- It said growth in most developing countries and economies in transition have generally been weaker.
- While higher commodity prices have helped countries reliant on commodity exports, rising food and energy prices have triggered rapid inflation, particularly in the nine-member Commonwealth of Independent States, formed after the break-up of the Soviet Union in 1991, and in Latin America and the Caribbean.
- Recovery has been especially slow in tourism-dependent economies, notably in the small island developing states. The United Nations forecast is similar to the World Bank's released on 11 January 2022.
- The 189-nation global financial institution that provides loans and grants to low and middle-income countries downgraded its forecast of worldwide economic growth to 4.1 per cent this year from the 4.3 per cent growth it was forecasting last June.
- It blamed continuing outbreaks of COVID-19, a reduction in government economic support and ongoing bottlenecks in global supply chains.