After the continuous growth of observers who are noticing the recession of the global economy, the chief of WTO( World Trade Organization) Ngozi Okonjo-Iweala also added her voice to this and reflects her concern too.
“The indicators are not looking very good”, The Director General of WTO, Ngozi Okonjo-Iweala said in an interview that was held in Geneva, at the Annual public forum’s opening.
She also added that “according to her knowledge, the world is edging into a global recession” and the reason she stated this is the crises of multiple overlapping.
She has noted the downgraded global growth forecasts for the International Monetary Fund (IMF) and the World Bank.
She has also suggested starting to think about the recovery as soon as possible in order to restore the growth.
Firstly covid-19 pandemic has activated crises such as bursting food prices, energy crunch, and escalating living costs, and then the conditions of global recession have been created from the Russia-Ukraine conflict.
Okonjo-Iweala stated that she is very concerned about food security, the threat of not having adequate food is the one that worries her the most. Access to energy is developing difficulty at the moment, she added. Food security and energy access, both issues are provoked by the Russia-Ukraine conflict.
Okonjo also called on the central bank to find out the reason behind the inflationary crisis, reflecting on her main concerns as food security and access to energy.
As the recession warning was given to Europe, their stock markets continued to decline even on Thursday(29-9-22). Europe has received similar warnings even from the World Trade Organization (WTO) and others as well.
To revive the growth, radical policies will be needed, as suggested by the former Nigerian Finance and Foreign minister, as according to him, “these shocks are devastating countries at the same time.”
WTO is expected to split its trade development projections for 2022 from next month. The Geneva-based trade body has decreased its projection for development in merchandise trade to 3% this year as compared to its previous year’s projection of 4.7% and this was done in April.
The bearish expectations of WTO for the global economy come when the Paris based OECD cutted its growth forecast for the next 20 years.
Recession fear sparks in U.S.
In the final estimate, the Bureau of Economic Analysis said that in just three months, the U.S. economy has reduced for the second time in a consecutive way. The BEA criteria’s latest figures meet the recession as soaring inflation and towering interest rates weigh on spending.
The debate has been called between economists over whether the U.S has fallen into recession, which was commonly explained as 2 succeeding quarters of negative growth.
On the other hand, the claim of the early 2022 recession has been repudiated by some economists and policymakers by quoting the robust job growth, manufacturing, and consumer spending.
The U.S. economy in the 1st half of 2022 is weaker as indicated by the annual revision to GDP and gross domestic income, the chief economist Gus Faucher of the PNC financial service group wrote on a note seen by CNN.
The U.S economy is in adjustment during 2022 and the data is clashing, he claimed, citing strength in areas such as spending, production, and the labor market.
The risk of recession remains elevated amid the Federal Reserve’s belligerent interest rate hikes to combat historically soaring inflation.
“And with that, they are going to see a notable slowing of the U.S economy, especially in interest rate sensitive sectors, like business investment and housing, ” he said.
Summary
The condition of the world economy has perturbed even the head of the World Trade Organization (WTO), Ngozi Okonjo-Iweala. She exhibits her concern by giving a statement that the world is edging into a global recession, and the indicators are not appearing good. She also suggested starting to think about the recovery from this loss as soon as possible.
The former Nigerian Finance and Foreign minister suggested adopting radical policies for reviving growth. Ngozi Okonjo-Iweala’s main concern as suggested by her is food security and access to energy according to her, both issues are provoked by the Russia-Ukraine conflict which needs to be concerned about and find a solution for them as soon as possible.
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