{{ subpage.title }}

Paige Fusco

What We’re Watching: Global stagflation warning, food fight at the UN, China in Cambodia

World Bank issues stark stagflation warning

The war in Ukraine has frustrated attempts to revive the pandemic-battered global economy, creating an endless loop of bad news. That trend continued Tuesday when the World Bank slashed its global growth forecast to 2.9% – down from a January prediction of 4.1%. (It was 5.7% in 2021.) What’s more, the body warned that “subdued growth” will likely continue throughout the decade and could give rise to 1970s-style stagflation – the double whammy of a stagnant economy coupled with double-digit inflation. But the impacts of the lingering global economic crisis won’t be felt equally. The World Bank says that while wealthy countries like the US and China will experience slower-than-usual growth, developing countries will be hardest hit as borrowing costs rise. This is already playing out: Cash-strapped Sri Lanka was recently forced to default on its sovereign debt for the first time. Crucially, the World Bank also warned that the deepening food crisis could cause social upheaval in import-reliant countries in the near-term.

Read Now Show less

Subscribe to GZERO Media's newsletter, Signal

Latest