Thursday, December 8

World Bank cuts growth forecast by almost a full percentage point over Ukraine war

Hardest hit will be Europe and central Asia

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WASHINGTON — The World Bank is reducing its global growth forecast for 2022 by nearly a full percentage point, to 3.2 per cent from 4.1 per cent, due to the impacts from Russia’s invasion of Ukraine, World Bank President David Malpass said on Monday.

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Malpass told reporters on a conference call that the World Bank was responding to the added economic stresses from the war by proposing a new, 15-month crisis financing target of $170 billion, with a goal to commit about $50 billion of this financing over the next three months.

Malpass said the biggest component of the bank’s growth forecast reduction was a 4.1 per cent contraction in the Europe and Central Asia region — comprising Ukraine, Russia and surrounding countries. Forecasts also are being cut for advanced and many developing economies because of spikes in food and energy prices caused by war-related supply disruptions, Malpass said.

© Thomson Reuters 2022