World Bank lowers its global growth forecast due to impact of Russia-Ukraine war
World Bank President David Malpass said on Monday that the World Bank is reducing its global growth forecast for 2022 by almost a full percentage point to 3.2 percent from 4.1 percent due to the effects of Russia’s invasion of Ukraine.
Malpass told reporters on a conference call that the World Bank was responding to additional economic stress from the war by proposing a new, 15-month crisis funding target of $170 billion, with a goal of about 50% of the next funding. Billion dollar target. three months.
Mr Malpass said the biggest component of the shortfall in the bank’s growth forecast was a contraction of 4.1 per cent in the Europe and Central Asia region – which included Ukraine, Russia and surrounding countries. Mr Malpass said forecasts are also being cut for advanced and many developing economies due to increased food and energy prices due to war-related supply disruptions.
The International Monetary Fund is expected to cut its global growth forecast on Tuesday.
“We are preparing for an ongoing crisis response, given the many crises,” Mr Malpass said. “Over the next few weeks, I look forward to discussing, with our Board, a new 15-month crisis response envelope of approximately $170 billion to cover from April 2022 to June 2023.”
The plan follows on from the World Bank’s $160 billion COVID-19 financing program, of which Mr Malpass said $157 billion was committed by June 2021.
Mr Malpass said the financing would partly support countries that have taken refugees from Ukraine and also help address problems in countries hit by food shortages.
Mr Malpass said the World Bank and IMF member states would discuss new aid to Ukraine this week, and expected specific commitments to be announced by several donor countries.