The United Nations released a disturbing warning about the future of the global economy.
The U.N. said that a global recession is likely.
“The world is headed towards a global recession and prolonged stagnation unless fiscal and monetary policies holding sway in some advanced economies are quickly changed, according to a new report released on Monday by the UN Conference on Trade and Development (UNCTAD),” the U.N. said.
The group warned of “cascading” consequences.
“UNCTAD is warning that the policy-induced global recession could be worse than the global financial crisis of 2007 to 2009,” the U.N. said. “Excessive monetary tightening and inadequate financial support could expose developing world economies further to cascading crises, the agency said. And while all regions will be affected, alarm bells are ringing most for developing countries, many of which are edging closer to debt default.”
The group released an economic report delving into the future economy, saying “growth will slow to 2.5 per cent in 2022 and drop to 2.2 per cent in 2023.”
“A global slowdown that would leave GDP below its pre-COVID pandemic trend and cost the world more than $17 trillion in lost productivity,” the U.N. said. “Despite this, leading central banks are sharply raising interest rates, threatening to cut off growth and making life much harder for the heavily indebted. The global slowdown will further expose developing countries to a cascade of debt, health, and climate crises. Middle-income countries in Latin America and low-income countries in Africa could suffer some of the sharpest slowdowns this year, according to the report.”