Continuing War, Pandemic, Inflation Drive Up Fears of Global Recession

As world leaders arrive for G7, G20, IMF and World Bank Meetings, the IMF downgraded economic growth to 2.7%. As the global economy grapples with the Ukraine war, pandemic, a food crisis and inflation, the IMF warns of recession in two reports.

"It seems likely that we are heading into a recession,” said Eric LeCompte, the Executive Director of the development organization Jubilee USA Network. "The US and other large economies will see contractions and this impacts the entire global economy.”

The released flagship IMF World Economic Outlook report considers that rising interest rates could trigger more debt crises in developing countries. 

"As the dollar gets stronger, developing country debts become dangerously unsustainable,” added LeCompte. "The war and rising interest rates are putting developing countries in an even more difficult situation."

In its Global Financial Stability Report, the IMF stated that the persistence of inflation is a challenge the world economy has not faced in decades.

"The combination of high inflation and recession deeply affects the poor,” stated LeCompte. "Some of the proposed solutions of austerity and higher interest rates will cause pain."

In a chapter devoted to climate finance, the report indicated that developing countries will need $300 billion a year just to adapt to the impacts of climate change, a figure that may grow larger by 2050.

"We need to protect our planet and we need to limit the economic losses posed by climate change," shared LeCompte.

On Wednesday, G7 and African finance ministers meet and on Thursday, G20 finance ministers. The IMF and World Bank main policymaking bodies meet on Friday.

Read the full World Economic Outlook Report here.

Read the full Global Financial Stability Report here.

Read Jubilee USA's statement on the IMF World Economic Outlook report here.

Read Jubilee USA's statement on the Global Financial Stability Report here.

Read Jubilee USA's press release on IMF chief Kristalina Georgieva's curtain-raiser speech here. 

Read Jubilee USA's press release on the IMF Food Shock Window here.

Find Jubilee USA's full list of this week's events here.

Find Jubilee USA's October 14th and 15th interfaith vigil, press conference and teach-in details here.