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OECD – world economic growth will slow down in 2023

The growth of the world economy will go from 3.1% this year to 2.2% in 2023, with a slight increase to 2.7% in 2024 – said the Organization for Economic Cooperation and Development (OECD), this Tuesday ( 22), in their updated forecasts.

Last year, the growth of the Gross Domestic Product (GDP) worldwide was 5.9%.

In a context of war in Ukraine, “growth is at half-mast, high inflation persists, confidence has deteriorated, and uncertainty is high”, observes the Paris-based organization.

For its interim chief economist, Álvaro Santos Pereira, “the world economy is experiencing its most serious energy crisis since the 1970s”, which has taken inflation “to unprecedented levels in several decades and is depressing growth worldwide”.

The rise in prices should reach an average of 8% this year in the countries of the G20, a group that brings together the main economies of the planet, before falling to 5.5% in 2023 and 2024, projects the OECD.

On the positive side, some inflationary pressures eased last year as supply chains, disrupted during the COVID-19 pandemic, re-established, while ocean freight costs receded.

“An end to the war and a just peace in Ukraine would be the most effective means of improving the world’s economic prospects,” OECD Secretary-General Mathias Cormann told a news conference.

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Santos Pereira says that the most likely scenario for next year “is not a global recession, but a clear slowdown in the world economy, as well as inflation that remains high, but is falling in many countries”.

To overcome the crisis, the OECD advocates “a greater tightening of monetary policy to combat inflation”, while at the same time stating that “tax benefits should be more specific and temporary”.

“Often, you need to better calibrate” this fiscal help to “ensure it is only temporary and focused on the most vulnerable households and businesses, and that incentives to reduce energy consumption are maintained”.

“Accelerating investment to adopt and develop clean energy sources and technologies will be crucial to diversify energy supply and ensure energy security,” added Santos Pereira.

In addition, the consequences of the war in Ukraine, which began nine months ago, “remain a threat to world food security, especially when combined with new extreme weather phenomena derived from climate change”, says the organization.

In Latin America, the report recognizes that the region’s main economies performed “better than expected in 2022, especially for food and energy exporters”.

At the same time, however, he anticipates that this recovery “will lose strength in 2023 and 2024”, due to “the toughening of global and national financial conditions”, the “end of fiscal aid still in force” and “less fluctuating prices of raw materials”. cousins”.

In Brazil, GDP growth of 2.8% is expected in 2022. The OECD also forecasts positive growth this year for Chile (1.9%), Mexico (2.5%), Colombia (8.1%) , Argentina (4.4%), among others.

The OECD works to drive economic growth and international trade. Its 38 member countries – including Mexico, Chile, Colombia, Costa Rica – represent 60% of world economic output. Brazil is in the process of joining.

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