Global economy ‘perilously close’ to recession in 2023, World Bank warns

Growth forecast slashed by almost half – and poorest countries could be hardest hit by credit squeeze

Shoppers crowd a clothes market in Dhaka last week (AFP via Getty Images)

The global economy will come “perilously close” to a recession this year, the World Bank warned on Tuesday as it slashed its 2023 growth forecasts.

The lender cut its estimate for global GDP growth by almost half, to 1.7 per cent, saying major slowdowns in advanced economies – including sharp cuts to its forecast to 0.5 per cent for both the United States and the eurozone – could trigger a global recession less than three years after Covid caused the last one.

In its previous Global Economic Prospects report, in June 2022, the bank had forecast 2023 global growth at 3 per cent.