“Despite some optimism, such as easing inflationary pressures, much of the outlook remains bleak,” said a report released by the World Economic Forum.
- The World Economic Forum said the outlook for the global economy in 2023 was “gloomy.”
- Concerns about a global recession are growing, according to a poll of economists released on the first day of the Davos meeting.
- Economists at major companies such as Google and Deutsche Bank say Europe and the US will be hit hardest.
The World Economic Forum (WEF) Annual Meeting (Davos Meeting) began on January 16, 2023 in Davos, Switzerland. On the first day, the January 2023 Chief Economists Outlook report, which summarizes the thoughts of top economists, was released. It was predicted that a recession was likely.
“Despite some optimism, such as easing inflationary pressures, much of the outlook remains bleak,” the report said, citing “continued economic uncertainty and policy challenges of historic magnitude.”
Nearly two-thirds of the 22 chief economists surveyed by the WEF say a global recession is likely in 2023, with 18% saying it’s “very likely.” .
“The global growth outlook remains lackluster and the risk of a global recession is high,” the report said.
But among the respondents, experts at financial and business giants such as UBS, Google, Microsoft and Bank of America, said there will be wide regional differences in economic growth through 2024. I expect.
All economists in Europe said economic growth was “weak” or “very weak,” and 91% in the United States. By contrast, the Middle East, North Africa, South Asia, China, and East Asia/Pacific region had less than half. More than half of economists in Europe expect high inflation, compared with only 5% in China.
The WEF said it believed this reflected higher energy prices, rising interest rates and “low demand” in Europe. In contrast, China’s economy is likely to pick up after the zero-corona policy was lifted. However, if the number of infected people increases, there is a possibility that production activities will stagnate.
Companies such as Amazon, Goldman Sachs and Salesforce have already announced layoffs, and economists who responded to the survey said such job cuts were expected, according to the WEF report. I expect it to continue. Eighty-six percent of respondents said multinationals would cut operating costs, and 78% expected it to lay off workers. Most respondents also said companies would pass on higher costs to their customers.
But despite the pessimistic outlook, some of the key concerns in the current global economy are expected to abate later this year, the report stresses.
Two-thirds of respondents expect the high cost of living crisis to become less severe by the end of 2023, and nearly two-thirds are optimistic that the energy crisis will begin to improve by the end of the year. ing. But JPMorgan CEO Jamie Dimon predicted in December 2022 that Europe’s energy crisis would worsen and likely last for years.
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(Translated by Fumiko Nakata, edited by Toshihiko Inoue)
Source: BusinessInsider
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