WTO chief says world economy tipping towards recession
The World Trade Organisation chief is echoing others in their concern over the world economy falling into a recession. WTO director-general Ngozi Okonjo-Iweala didn’t hold back when she recently commented on the situation.
“The indicators are not looking good. I think a global recession-that is what I think we are edging into.”
Her analysis comes as the WTO intends to slash its trade growth projections for 2022. In April, it lowered its projection for growth in merchandise trade this year to 3%, down from almost 5%. The decrease in growth projection comes after Paris-based OECD cut its growth forecasts for the Group of 20 next year.
Okonjo-Iweala says she is mostly concerned with food security and energy access issues, noting that they have been affected by Russia’s invasion of Ukraine.
“I am very concerned about food security. The spectre of not having enough food is one that worries me. Access to energy is creating problems at the moment.”
Widespread international concern has been mounting after the invasion of Ukraine with some analysts comparing the impending food shortage to something similar, or worse than, that of the crisis faced in 2007 and 2008. As the global food system has already taken a hit due to the Covid-19 pandemic, analysts say the war in Ukraine isn’t helping the global food crisis.
Russia and Ukraine together export nearly 12% of food calories that are traded globally, being major providers of basic agro-commodities. Such commodities include maize, sunflower oil, and wheat. Russia is also the world’s top exporter of fertilisers. Several regions are very dependent on imports from these two countries for their basic food supply. The two countries supply over 50% of cereal imports in the Middle East and North Africa combined. Eastern African countries import 72% of their cereals from Russia and 18% from Ukraine.
Other analysts say the war in Ukraine has pushed food insecurity levels up by at least a few percentage points worldwide, with more predictions of such food shortages expected to rise.
SOURCE: Bangkok Post
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