This article discusses the projected impact of the pandemic on economic growth in 2022. According to the article, the World Bank projects that global economic growth will be lower than it was in 2021, falling from 5.5% to a predicted 4.1%. Although the past year marked some economic recovery, the article states that this recovery will be stunted as a result of resurging waves in the pandemic. Furthermore, the World Bank predicts that “output is expected to be weaker and inflation is likely to be hotter than previously thought” (Rappeport 2022). As prices continue to rise and supply chains continue to be impacted by spikes in cases, the pandemic will take an especially harsh toll on developing countries.
The article also underlines how this public health crisis is heavily impacting areas of the world where economic inequity is very apparent. In a report on the effects of the Covid-19 crisis, World Bank president, David Malpass, described how the pandemic has undone many years of work towards poverty reduction. Income inequality is continuing to widen between countries as well as within them. Additionally, the World Bank reports that most developing markets outside of East Asia and the Pacific would return to their pre-pandemic levels.
As the recent waves in the pandemic continue to slow down economic recovery, the World Bank predicts that many less advanced countries will suffer from ‘substantial scarring’ in their economic output. Furthermore, the possibility of increasing interest rates and decreasing fiscal support could also negatively impact these already vulnerable countries. In order to bring aid to these countries, the World Bank is recommending an increase in debt relief initiatives. Some additional methods for helping to spur growth in lesser developed countries are to increase investments in infrastructure and distribution of Covid vaccines. In the world’s larger economies, such as the US and China, the article states that economic growth will be moderate, but these larger nations will find it difficult to witness significant growth. For example, pandemic restrictions are curbing consumer spending and investment.
With the resurgence in Covid-19 cases due to the rise of the Omicron variant, it seems likely that 2022 will be yet another year of slow economic growth. As the World Bank has projected, it is very likely that this year could do more damage than help in the fight against economic inequality, as lesser developed countries continue to suffer from the effects of the pandemic.
https://www.nytimes.com/2022/01/11/business/world-bank-2022-growth.html
I think that it is important that richer countries recognize the even more impactful damages that are happening to the less developed countries from the Covid-19 pandemic. Across the globe, it is very apparent the economic hardships that the pandemic has put on all countries, but we fail to recognize the countries who are suffering even more than us. After months of severe shortages, Covid-19 vaccine supplies for the world’s poorest nations are finally ramping up. Luckily there is a World Health Organization-backed program “Covax” that buys shots for developing countries, but we are still seeing some problems with delivering the vaccines. Authorities lack funds to conduct public awareness campaigns and set up more vaccination sites, including the necessary fridges and freezers to store the shots. Misinformation and low case numbers have also left many in poor countries skeptical of the shots. Hopefully, we see some progression over the next few months with the vaccination rate of the poorer countries which will then hopefully lead to growth in their economy.
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