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OECD cuts global economic outlook over Russia-Ukraine war

LONDONRussia’s War in Ukraine and the energy and food crises A deterioration will severely affect global economic growth this year and push up inflation, the Organization for Economic Co-operation and Development said on Wednesday.

China’s “zero-COVID” policy, which has disrupted manufacturing supply chains, is also weighing on a global economy that is only just beginning to recover Covid-19 pandemicsaid the Paris-based OECD, becoming the latest institution to trim its growth forecast and underscored the darkening economic outlook.

The OECD, a club of largely wealthy nations, expects the global economy to grow 3% in 2022, compared to the 4.5% it forecast in December.

Inflation is forecast at nearly 9% for the 38 member countries of the OECD, which includes the United States, the United Kingdom and many European countries, almost double the previous estimate.

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That World Bankthe United Nationsand the IMF have recently made similar downgrades to their economic forecasts.

“Russia’s war is indeed demanding a high price for the global economy,” said OECD Secretary General Mathias Cormann at a press conference in Paris.

The organization released its forecast as it prepares for a two-day annual meeting beginning Thursday that will be attended by government ministers and will include video comments from Ukrainian President Volodymyr Zelenskyy.

The OECD warned that the poor will be hit hardest by the economic turmoil. the war is Interruption of the supply of staple foods such as wheat and energy, of it Russia and Ukraine are important global suppliersand that’s fueling inflation, which is eating away at disposable income and living standards, it said.

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the war is Harm economic growth in European countries most because they are more exposed to war through trade and war energy connections. But the OECD also sounded the alarm poor countries far away, facing food shortages.

“We are very concerned about the nutritional situation in low-income countries. The war is really sending shock waves as far as Africa and the USA middle East‘ said OECD chief economist Laurence Boone. “The war could cause famine. It could cause political unrest and turmoil.”

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https://www.local10.com/business/2022/06/08/oecd-slashes-global-economic-outlook-on-russia-ukraine-war/ OECD cuts global economic outlook over Russia-Ukraine war

Sarah Y. Kim

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