WORLD BANK / GLOBAL ECONOMIC PROSPECTS

11-Jan-2022 00:06:15
The World Bank Group said on Tuesday that the global economy is entering a pronounced slowdown amid fresh threats from COVID-19 variants and a rise in inflation, debt, and income inequality that could endanger the recovery in emerging and developing economies. WORLD BANK GROUP
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STORY: WORLD BANK / GLOBAL ECONOMIC PROSPECTS
TRT: 6:15
SOURCE: WORLD BANK GROUP
RESTRICTIONS: PLEASE CREDIT WORLD BANK GROUP
LANGUAGE: ENGLISH / NATS

DATELINE: 10 JANUARY 2022, WASHINGTON DC
SHOTLIST
JANUARY 2022, WASHINGTON, DC

1. Wide shot, exterior shot of World Bank Group Headquarters

10 JANUARY 2022, WASHINGTON DC

2. SOUNDBITE (English) Ayhan Kose, Director, Prospects Group, World Bank:
“Going forward, we are projecting a pronounced slowdown, and the numbers are very clear. The global economy delivered five and a half percent growth last year. It's a remarkable number, but going forward this year, we will see growth around 4 per cent, and the next year that number is going to go down to 3 per cent. Why? Because basically pent-up demand will not be there. Demand is going to be smaller. In addition, policy makers around the world are withdrawing these support measures. So the policy support is going to be withdrawn. So between those two, we will have a slow-down. Of course, there are risks down the road and those risks are significant. COVID is still with us. We are experiencing, of course, the Omicron wave. Debt levels are quite high. We have inflationary pressures. We have climate-related challenges. When you put all of these with very limited policy space in emerging market developing economies, these risks increase the possibility of a hard landing. In a nutshell, we have slowing growth. We have withdrawn policy support, and we have a plethora of risks that increases the possibility of a hard landing. Policy makers need to be proactive to get ahead of these risks and mitigate that possibility.”

JANUARY 2022, WASHINGTON, DC

3. Wide shot, exterior shot of World Bank Group Headquarters

10 JANUARY 2022, WASHINGTON, DC

4. SOUNDBITE (English) Ayhan Kose, Director, Prospects Group, World Bank:
“On the surface, advanced economies are slowing, emerging market developing economies are slowing as well, but it is as if these two groups of countries are following different flight paths. Advanced economies are still flying high. By the end of 2023, they're going to go back to their pre-pandemic trend output levels. When you look at emerging market developing economies, they're flying low. At the end of 2023, their output levels are going to be still 4 per cent below what they would have if they didn't have the pandemic in trend terms.”

JANUARY 2022, WASHINGTON, DC

5. Wide shot, exterior shot of World Bank Group Headquarters
10 JANUARY 2022, WASHIN GTON, DC

6. SOUNDBITE (English) Ayhan Kose, Director, Prospects Group, World Bank:
“This pandemic is a pandemic of inequality. It's not just incomes are being affected. You see availability of vaccines. You look at access to education and healthcare, and of course the scale of job losses, especially in the context of women, especially in the context of those workers in informal sectors, especially in the context of poor. So when you put all of these together, the picture with respect to inequality is quite serious.”

JANUARY 2022, WASHINGTON, DC

7. Wide shot, exterior Shot of World Bank Group Headquarters

10 JANUARY 2022, WASHINGTON, DC

8. SOUNDBITE (English) Ayhan Kose, Director, Prospects Group, World Bank:
“On the one hand, growth is slowing. On the other hand, inflationary pressures are there, debt and deficits are quite sizeable, and monetary authorities need to get ahead of inflation, so they have to increase interest rates. Fiscal authorities need to basically think about how they are going to reduce the debt and deficit at the same time. This will require a concerted effort to withdraw the policy in a calibrated fashion.”

JANUARY 2022, WASHINGTON, DC

9. Wide shot, exterior Shot of World Bank Group Headquarters

10 JANUARY 2022, WASHINGTON, DC

10. SOUNDBITE (English) Ayhan Kose, Director, Prospects Group, World Bank:
“So at the country level, national policymakers need to carefully withdraw fiscal and monetary policy, think about the consequences of their decisions, and at the same time of course, communicate clearly what they are trying to do. That means having a medium-term plan, how they are going to overcome certain excesses accumulated because of the pandemic, and how they're going to create the revenues, how they are going to improve the public explanatory efficiency. Beyond that in the medium and long-term at the national level, there is a lot to be done in terms of reforms, in terms of policy interventions when it comes to health, when it comes to education, when it comes to infrastructure, when it comes to having a stronger digital service to different remote parts of emerging market developing economies. Ultimately the objective is to promote long-term growth prospects. Now at the global level, I think the message is very clear. We need aggressive global cooperation in vaccines, in debt relief, and in climate change. All of these will require global community acting together, and taking these challenges seriously, and implementing the policies necessary.”

JANUARY 2022, WASHINGTON, DC

11. Wide shot, exterior Shot of World Bank Group Headquarters
STORYLINE
The World Bank Group said on Tuesday that the global economy is entering a pronounced slowdown amid fresh threats from COVID-19 variants and a rise in inflation, debt, and income inequality that could endanger the recovery in emerging and developing economies.

The January 2022 Global Economic Prospects report shows global growth is expected to decelerate markedly from 5.5 percent in 2021 to 4.1 percent in 2022 and 3.2 percent in 2023 as pent-up demand dissipates and as fiscal and monetary support is unwound across the world.

The slowdown will coincide with a widening divergence in growth rates between advanced economies and emerging and developing economies. Growth in advanced economies is expected to decline from 5 percent in 2021 to 3.8 percent in 2022 and 2.3 percent in 2023—a pace that, while moderating, will be sufficient to restore output and investment to their pre-pandemic trend in these economies.

In emerging and developing economies, however, growth is expected to drop from 6.3 percent in 2021 to 4.6 percent in 2022 and 4.4 percent in 2023.
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