The growth of the world economy will suffer a setback. According to OECD forecasts released on Tuesday, it should fall from 3.1% in 2022 to 2.2% next year, before picking up slightly to 2.7% in 2024.
In the context of the war in Ukraine, “growth is at half mast, high inflation is persistent, confidence has eroded and uncertainty is high,” the organization notes.
High energy costs are particularly affecting the health of the world’s major economies.
“The energy shock has brought inflation to levels not seen in several decades and has reduced growth throughout the world,” continues the economist.
An 8% price increase in the G20 countries
Price increases are expected to reach 8% on average this year in the G20 countries, which includes the world’s largest economies, before falling to 5.5% in 2023 and 2024, according to the organization’s projections.
Álvaro Santos Pereira explains that the most probable scenario foreseen by the OECD “is not a global recession, but a sharp slowdown in the world economy in 2023, as well as inflation that is still high but declining in many countries.”
To overcome the crisis, the OECD, an organization that brings together 38 States, developed countries and some emerging countries, advocates “continuing to tighten monetary policy to combat inflation” while considering that “budget support must be more targeted and temporary”.
“Accelerating investment to adopt and develop clean energy sources and technologies will be crucial to diversify supply and ensure energy security,” continues the economist.
0.6% growth in 2023 for France
For France, the OECD projects growth of 2.6% in 2022 and a slowdown to 0.6% next year, compared to 1% forecast by the Government and 0.7% by the International Monetary Fund (IMF). The French economy would then recover, but rather weakly, up to 1.2% growth in 2024.
The rise in prices would reach 5.9% this year, 5.7% in 2023 and then fall back to 2.7% in 2024.
The OECD forecasts for France a “decrease in business and household confidence”, as well as an unemployment rate that will rise to 8.1% in 2024, moving the country away from the goal of full employment with a rate of 5% expected by the government.
Like the IMF on Monday, the OECD calls on France to “improve the targeting of support measures to reduce their budget cost, avoid hindering structural changes and limit additional inflationary pressure.”
Source: BFM TV
