Sun. Jan 29th, 2023
Ukraine War

According to the United Nations’ World Economic Situation and Prospects (WESP) report, the global economy is expected to grow by 3.1 percent this year, down from the 4.0 percent projected in January. The report suggests that it has a lot to do with the ‘fragile economic recovery’ from the COVID-19 pandemic and war in Ukraine.

Not only has the war in Ukraine triggered the humanitarian crisis in Europe, but it has also contributed to a spike in food and commodity prices and exacerbated inflationary pressures.

“The war in Ukraine- in all its dimensions – is setting in motion a crisis that is also devastating global energy markets, disrupting financial systems and exacerbating extreme vulnerabilities for the developing world,” said the UN Secretary-General Antonio Guterres.

Major economies like the United States, the European Union and China, as well as most developed and developing economies, are experiencing growth downgrades.

Furthermore, the report analyzes the impacts of the war in Ukraine. Let alone the emerging refugee crisis – more than six million refugees. Aside from the humanitarian crisis, it has negatively impacted other countries’ economies.

For instance, the soaring food and energy prices have severe implications for the developing economies and have increased the vulnerability of food insecurity, specifically in Africa, which affects the low-income household disproportionately.

“We need and a quick and decisive action to ensure the steady flow of food and energy in open markets, by lifting import restrictions, allocating surpluses and reserves to those who need them, and addressing food price increases to calm market volatility,” the Secretary- General added.

As far as India is concerned, as the report suggests, India is projected to grow by 6.4% in 2022, comparatively lower than the previous year. However, this fastest-growing economy is coupled with high inflationary pressures and an uneven labor market recovery.

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