The president of the World Trade Organization stated on Tuesday that she believes the world is headed for a global recession as a result of several crises interacting with one another and urged drastic policies to resuscitate the economy.
According to WTO Director-General Ngozi Okonjo-Iweala, the circumstances for a global recession are being set by Russia’s conflict in Ukraine, the climate catastrophe, shocks to food and energy prices, and the effects of the CoVid-19 epidemic.
She stated at the start of the annual public conference of the international trade organization in Geneva that “now we have to weather what looks like an incoming recession.”
“I predict a worldwide recession. I believe that is where we are headed. However, we also need to begin planning for the recovery. We must reestablish growth. She mentioned that both the World Bank and the International Monetary Fund had lowered their predictions for global growth, and that trade indications were “not looking too good.”
“We cannot afford to do business as usual” Okonjo-Iweala continued. “We have security shocks, climate shocks, energy shocks, and food price shocks all striking countries simultaneously.” The former finance and foreign minister of Nigeria claimed that central banks were in a difficult situation and had few options for the future.
The consequences for emerging markets and developing countries are pretty severe, she added, because they are also tightening and raising interest rates. “Central banks really don’t have much of a choice except to tighten and increase interest rates,” she said.
“However, what happens in the developed countries has an impact on their debt loads, the costs associated with debt servicing, and the flow of capital out from their economies and back into the developed countries.
