UN chops global economic growth forecast to 1.9% in 2023

The United Nations is the newest group to reduce its forecast for 2023 global economic growth.

The U.N. said Wednesday that growth will fall considerably to 1.9% this 12 months.

The forecast is down from an estimated 3% in 2022, one of many lowest growth charges in latest a long time. 

Contributing components are the meals and vitality disaster sparked by the warfare in Ukraine, the affect of the COVID-19 pandemic, persistently excessive inflation and the local weather emergency.

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People wait without spending a dime meals outdoors an eatery in Ahmedabad, India. Growing numbers of individuals in Asia lack sufficient meals to eat as meals insecurity rises with larger costs and worsening poverty, in accordance to a report by the Food and Agricultural Organizat ((AP Photo/Ajit Solanki, File) / AP Newsroom)

The U.N. Department of Economic and Social Affairs mentioned the present global economic slowdown “cuts throughout each developed and growing international locations, with many dealing with dangers of recession in 2023.”

“A broad-based and extreme slowdown of the global economic system looms massive amid excessive inflation, aggressive financial tightening, and heightened uncertainties,” U.N. Secretary-General Antonio Guterres mentioned in a foreword to the 178-page report.

The U.N. does challenge a reasonable pick-up to 2.7% in 2024 if inflation progressively abates and economic headwinds begin to subside.

The World Bank reduce its growth forecast practically in half earlier this 12 months from a earlier projection of three% to simply 1.7%.

Ukrainian servicemen are seen subsequent to a destroyed armored car, which they mentioned belongs to the Russian military, outdoors Kharkiv, Ukraine.

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The International Monetary Fund, which offers loans to needy international locations, projected in October that global growth would sluggish from 6% in 2021 to 3.2% in 2022 and a pair of.7% in 2023. 

According to the U.N. report, this 12 months “growth momentum has weakened in the United States, the European Union and different developed economies, adversely affecting the remainder of the world economic system.”

In the United States, GDP is projected to increase by solely 0.4% in 2023 after estimated growth of 1.8% in 2022, the U.N. mentioned. 

Fed Chair Jerome Powell and Federal Reserve Building (Photo Credit:  Getty Images / iStock / Getty Images)

Many European international locations are projected to expertise “a light recession” with the warfare in Ukraine heading into its second 12 months on Feb. 14, excessive vitality prices, inflation, and tighter monetary circumstances miserable family consumption and funding.

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The economies in the 27-nation European Union are forecast to develop by simply 0.2% in 2023, down from an estimated 3.3% in 2022, the U.N. mentioned. 

The United Nations Headquarters in New York City. (iStock / iStock)

And in the United Kingdom, which left the EU three years in the past, GDP is projected to contract by 0.8% in 2023, persevering with a recession that started in the second half of 2022, it mentioned.

The U.N. forecast that China’s economic system, which expanded by solely 3% in 2022, will speed up to 4.8% this 12 months.

The U.N. report mentioned Japan’s economic system is predicted to be among the many better-performing developed international locations this 12 months, with GDP forecast to enhance by 1.5%, barely decrease than final 12 months’s estimated growth of 1.6%.

The Associated Press contributed to this report.