A resurgence of the COVID-19 pandemic and escalating geopolitical tensions could push the global economy into recession.
If this happens, it would mark the first time in more than 80 years that two global recessions occurred within the same decade.
The forecast is contained in the World Bank’s latest Global Economic Prospects report.
It said global growth is slowing amid higher inflation and interest rates, reduced investment and disruptions caused by Russia’s invasion of Ukraine.
The report predicts the global economy may grow by 1.7% in 2023 and 2.7% in 2024 while growth in developing economies could decelerate from 3.8% in 2022 to 2.7% in 2023.
The downturn is expected to be widespread, with the forecasts in 2023 revised down for 95% of advanced economies and nearly 70% of developing economies.
In Sub-Saharan Africa, which accounts for about 60% of the world’s poorest, growth in per capita income over 2023-24 is expected to average just 1.2%.
World Bank Group President, David Malpass said the crisis facing development is intensifying as the global growth outlook deteriorates.
The top economy analyst noted that emerging and developing countries would have to contend with a multi-year period of slow growth.
The decline is driven by heavy debt burdens and weak investment as global capital is absorbed by advanced economies faced with high government debt levels and rising interest rates.
“Weakness in growth and business investment will compound the already-devastating reversals in education, health, poverty, and infrastructure and the increasing demands from climate change”, Malpass added.