World Bank Lowers Global Economy Growth Forecast Due to War

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The global economy will grow less strongly this year than previously thought due to the war in Ukraine. That’s what President David Malpass of the World Bank said. He now expects a growth of 3.2 percent.

In January, the World Bank forecast growth of 4.1 percent.

The World Bank and other major institutions such as the International Monetary Fund (IMF) and the World Trade Organization (WTO) have previously warned about the negative impact of the war in Ukraine on the global economy. The IMF will release new estimates on Tuesday. These will also be revised downwards. Like the IMF, the World Bank holds its spring meeting this week.

Malpass mainly points to the sharp rise in fuel and food prices resulting from the conflict in Ukraine. Poor countries are particularly vulnerable to rising prices, according to the CEO. Many people are at risk of falling into extreme poverty as a result, Malpass warned. He also said that a new bailout fund of 170 billion dollars would be discussed to help poor countries against the economic crisis caused by the Russian invasion of Ukraine.

Ukraine is also receiving aid from the World Bank. So far, $3 billion in immediate relief has been pledged. The money will go towards salaries for hospital staff, pensions and social programs in Ukraine, among other things. This week, according to Malpass, talks will continue about further aid to the country, including for reconstruction.