IMF cuts global growth forecast to 3.6% as Russia’s war in Ukraine hits neighbors hard
The global economy will suffer a hit to growth and higher inflation this year as a result of Russia’s invasion of Ukraine, the IMF said in its World Economic Outlook.
Prospects had “worsened significantly” with countries closest to the war likely to be hardest hit, according to the fund. But risks had intensified everywhere, raising the chances of even lower growth and more rapid price rises, and undermining a stronger recovery from the pandemic in 2022.
The IMF forecasts global real GDP growth this year of 3.6%. In January, it expected the global economy to grow by 4.2% in 2022. This year it will grow two times slower than last year. In 2021, global growth was estimated at 6.1%.
The IMF predicted a 35% collapse in GDP in Ukraine as it has been suffering from the destruction of its infrastructure and mass emigration. Meanwhile, sanctions and a pariah status would lead to an 8.5% drop in Russian GDP.