Global economy heading into 'eye of Category 5 hurricane,’ UN secretary-general warns

Global economy heading into ‘eye of Category 5 hurricane,’ UN secretary-general warns

United Nations Secretary-General Antonio Guterres provided a sobering outlook on the worldwide economy at Davos 2023, warning the world is heading into the attention of a Category 5 financial hurricane. 

“We are trying into the attention of a Category 5 hurricane. Our world is stricken by an ideal storm on a quantity of fronts,” Guterres stated on the World Economic Forum Wednesday. “Start with the quick time period, the worldwide financial disaster. The outlook, as everyone knows, is bleak. Many elements of the world face recession and the whole world faces a slowdown. And we see deepening inequalities and the quickly unfolding price of dwelling disaster affecting ladies and women essentially the most. Supply chain disruptions and an power crunch, hovering costs.”

Guterres additional elaborated his fears over the “good storm” hitting the world on “Mornings with Maria” Wednesday. 

“I’m nervous with the truth that we’ve a mixture of issues which can be all interlocked and which have unfavorable synergies,” he stated. 


Antonio Guterres UN

 United Nations Secretary-General Antonio Guterres stated he is nervous concerning the “good storm” hitting international economies on “Mornings with Maria.”  (AP Photo/Mary Altaffer, File / AP Newsroom)

The battle in Ukraine, skyrocketing meals and power costs, local weather change and elevated wealth inequality have been some of the components Guterres feared are “making a state of affairs” that present a “clear recession perspective.”

In addition, Guterres pointed to economies past the U.S., Europe and Asia which can be burdened with economic hardships. 

“Interest charges are going up extraordinarily within the international south. Countries are near default. They don’t have any sources as a result of they could not print cash just like the U.S. did, like Europe did through the COVID,” Guterres stated. “They don’t have any entry to concessional funding as a result of many of them are middle-income nations. Look at small island creating states, the Caribbean islands. They lived on tourism. The tourism has ended for 2 years, however as they’re centerrevenue nations, they’d no debt to stay, they’d no concessional funding. So we’ve within the Global South, a state of affairs during which persons are struggling and we have to perceive that.”

Guterres known as for growing the “mechanisms of international solidarity” in mild of the widespread financial struggling. 


When requested what the U.N. can do to fight the financial hurricane, Guterres laid out a proposal from the United Nations that emphasizes a world stimulus to handle financial woes in addition to instruments to oversea a “simply transition” from fossil gasoline dominance to clean energy

“Our proposal is to have a world stimulus, a world stimulus capable of redress the economies, and a world stimulus capable of tackle the challenges of the poorest on the earth, and on the identical time to create the funds which can be mandatory for a simply transition in relation to local weather change,” Guterres informed host Maria Bartiromo.

“We want to maneuver from a dominance of fossil fuels to dominance of renewables. But we have to do this in a simply manner,” he added. “We simply take into account the those who can be affected negatively within the areas that stay with fossil gasoline predominance. Looking into coaching, trying to new jobs, the areas must be invested. This transition must be properly managed, not just like the rust belt of the previous during which the transition from heavy business within the United States, in Europe, in different elements of the world was not correctly met as properly.”

Guterres additionally defined the U.N. needs “increased commitments” from China to maneuver extra shortly in bringing down its home emissions to assist the worldwide effort to fight local weather change. He famous, nevertheless, technological assist could also be wanted to assist China obtain quicker emission discount. 

“We must guarantee that China reduces emissions. This is significant for the world,” Guterres stated. “But China wants some technological assist, I would not say monetary, however technological assist to have the ability to do it as a result of they’ve a way more old style business in a quantity of areas and far more reliance on coal.”


Given the worldwide financial outlook and local weather fears, Guterres added it’s “completely important” to have “critical” negotiations between the West and China.

“With local weather, with the slowdown of the worldwide economy, with the dramatic state of affairs of the creating world, with the dangers of a pandemic coming again, I believe it’s completely important to have a critical negotiation on the desk the place every thing is put very clearly between China and the Western world.”