World Economic Growth Expected to Slow to 2.4 Percent in 2023

The United Nations Conference on Trade and Development (UNCTAD) has warned of a stalling global economy.

IDXChannel - The United Nations Conference on Trade and Development (UNCTAD) has warned of a stalling global economy, with growth slowing in most regions from last year and only a few countries bucking the trend.

According to its Trade and Development Report 2023, released today, world economic growth is projected to slow from 3% in 2022 to 2.4% in 2023. While Brazil, China, Japan, Mexico and Russia will buck the trend, they are not expected to grow strongly.

Inflation has come down from the highs of late 2022, but it’s a slow and halting descent, largely due to the easing of supply-side pressures. Tighter monetary policy has so far contributed little to ease prices and has come at a steep cost in terms of inequality and damaged investment prospects.

"To safeguard the world economy from future systemic crises, we must avoid the policy mistakes of the past and embrace a positive reform agenda," UNCTAD Secretary-General Rebeca Grynspan said in a media release on Wednesday (4/10/2023).

He called for a change in policy direction, including by leading central banks, and accompanying institutional reforms promised during the Covid-19 crisis to avert a lost decade.

Institutional reforms of the global financial architecture, more pragmatic policies to tackle inflation, inequality and sovereign debt as well as stronger oversight of key markets are needed.

"We need a balanced policy mix of fiscal, monetary and supply-side measures to achieve financial sustainability, boost productive investment and create better jobs. Regulation needs to address the deepening asymmetries of the international trading and financial system," he added. (WHY)