The World Bank has reduced its global growth forecast due to the impact of the Russia-Ukraine war
On Monday, World Bank President David Malpass said the World Bank is reducing its global growth forecast for 2022 to 3.2% from 4.1% to 3.2%.
Malpass told reporters on a conference call that the World Bank is responding to rising economic tensions from the war by proposing a new, 15-month crisis funding target of 170 billion dollars, with the goal of committing about $50 billion in this funding over a period of up to three months.
Mr. Malpass said the biggest factor causing the bank to reduce its growth forecast was a 4.1 percent decline in the Europe and Central Asia region – which includes Ukraine, Russia and surrounding countries. Forecasts are also being slashed for advanced and developing economies due to spikes in food and energy prices due to war-related supply disruptions, Malpass said.
The International Monetary Fund is expected to cut its global growth forecast on Tuesday.
“We are preparing for a continuous crisis response, with multiple crises,” Mr. Malpass said. “Over the next few weeks, I expect to discuss with our board a new 15-month crisis response package worth approximately $170 billion to cover April 2022 through June 2023.”
The plan builds on the World Bank’s $160 billion COVID-19 funding program, of which Malpass said it has committed $157 billion through June 2021.
Mr. Malpass said the funding will partly assist countries receiving refugees from Ukraine and will also help solve problems in countries affected by food shortages.
Malpass said the World Bank and IMF member countries will this week discuss new support for Ukraine, and expect specific commitments will be announced by some donor countries.
