The World Bank has slashed its global economic growth forecast.

It says 70 per cent of Developing and Emerging Economies, are facing economic recession as they are particularly vulnerable to the looming economic slowdown having racked up higher public debt during the pandemic.

However, Jamaica is not among the countries expected to fall into recession. It says Jamaica is expected to continue to grow this year, but will see a reduction in the rate of growth.

The World Bank says the possible global economic crisis is due to rising inflation and stagnating economies.

Chevon Campbell reports.

Global economic woes continue.

The World Bank in its latest report is slashing its growth projection from 4.1 per cent down to 2.9 per cent. There’s very little expectation for this to improve before 2024.

While the world continues to grapple with the effects of the Covid-19 pandemic, it’s now being faced with mounting fiscal pressures.

The war in Ukraine which has now gone beyond one hundred days rages on.

The consequent surge in commodity prices has now been coupled with further lockdowns in China and more disruptions to global supply chains.

World Bank President, David Malpass, is warning that recession will be difficult to avoid by many countries.

However, Jamaica is among the exceptions.

The Multilateral is projecting the local economy will grow by 3.2 per cent this year.

Jamaica is likely to avoid slipping into recession due to it’s debt management efforts.

It’s a scenario that Finance Minister Dr Nigel Clarke has repeatedly warned about as far back as his budget presentation in 2021.

It would seem the prudent and aggressive push to reduce the country’s debt has paid off.

During that 2021 presentation Dr Clarke stated Jamaica’s policies were geared toward ensuring this exact situation did not come to pass and rejected moves to reduce Jamaica’s primary surplus target.

However the country is not immune to the expected slowdown in global growth.

Jamaica’s GDP gains are expected to slow to 2.3 per cent in 2023 and further moderate down to 1.3 per cent in 2024.

This reduced rate of growth, coupled with rising inflation has the World Bank on watch for a possible 1970s style stagflation crisis.

It says reducing that risk will require targeted and impactful measures by policymakers across the world.