Xinhua News Agency, Geneva, January 21. Summary: Global economic recovery is difficult to strengthen policy coordination and reach consensus
The 2022 World Economic Forum video conference concluded on the 21st. During the discussion that day, several delegates called for the world economic recovery to face problems such as high inflation, high debt and unbalanced vaccination. All countries should be alert to risks and strengthen cooperation to avoid a greater crisis in the world economy.
International Monetary Fund (IMF) President Georgieva said on the same day that in 2022, the road to global economic recovery will be full of ups and downs. Factors such as repeated new crown epidemics, high inflation in many countries, and record global debt levels are causing economic growth to lose momentum. . She expects that the world economy will continue to recover this year, but at a slower pace.
Data show that more than half of the world‘s population has received two doses of the vaccine, but the vaccination rate in Africa is only 7%. Georgieva emphasized that nearly 90 countries have not reached the vaccination target, and the vaccination rate varies widely among countries, which is very dangerous.
The Global Investment Trends Monitoring Report released by the United Nations Conference on Trade and Development a few days ago predicts that the growth prospects of global foreign direct investment (FDI) in 2022 are still optimistic, but it is unlikely to maintain the high growth rate in 2021.
The fiscal and monetary policies of many developed economies are also under pressure. Bank of Japan Governor Haruhiko Kuroda said Japan’s economic recovery is lagging, and public sector debt is now far exceeding gross domestic product (GDP). The Japanese government does not expect a primary surplus to start until 2025, after which public debt levels will decline. Kuroda expects Japan’s inflation rate to remain at 1% in 2022, and said the Bank of Japan will continue to maintain loose monetary policy.
European Central Bank President Christine Lagarde said in her speech that so far, inflation pressures in Europe have not gotten out of control, and market demand and employment participation have just returned to pre-pandemic levels. She said that in the face of the impact of the epidemic, appropriate monetary and fiscal policy is an important response.
Brazilian Economy Minister Paul Guedes believes that inflation will be a long-term problem in the Western world, and inflationary pressures will not disappear in the short term.
Looking ahead, Georgieva stressed that central banks and fiscal policymakers around the world should “prevent the world from falling into another Great Depression in a highly coordinated manner.” She believes that maintaining policy flexibility is critical to the global recovery in 2022.
Liang Guoyong, a senior economist at the United Nations Conference on Trade and Development, said in an interview with Xinhua News Agency that the trend of the world economy in 2022 may show the characteristics of “weak recovery” and “high risk”. Emerging economies and developing countries should first strengthen risk prevention to avoid External financial risks have a severe impact on the domestic economy.
Liang Guoyong believes that the negative spillover effect of monetary policy adjustment in major developed economies such as the United States is very large, which will bring major risks to the world economy. Some economies that lack resilience and whose financial systems are less resilient to risks may experience severe financial crises. He said that the central banks of major economies in particular need to strengthen policy communication and focus on reducing external shocks and spillovers caused by monetary policy adjustments in major developed countries.