《聯合國：2023年中期世界經濟形勢與展望報告（英文版）（28頁）.pdf》由會員分享，可在線閱讀，更多相關《聯合國：2023年中期世界經濟形勢與展望報告（英文版）（28頁）.pdf（28頁珍藏版）》請在三個皮匠報告上搜索。

1、MID-YEAR UPDATE2023World Economic Situation and ProspectsThe World Economic Situation and Prospects as of mid-2023 updates the World Economic Situation and Prospects 2023 released on 25 January 2023.The report is prepared by the Global Economic Monitoring Branch in the Economic Analysis and Policy D

2、ivision of the United Nations Department of Economic and Social Affairs.World Economic Situation and ProspectsMID-YEAR UPDATEWorld Economic Situation and Prospects as of mid-2023The world economy is facing severe headwinds amid weak growth prospects,elevated inflation and heightened uncertainties.A

3、confluence of factors legacy effects of the COVID-19 pandemic,the lingering war in Ukraine,the ever-worsening impact of climate change and rapidly shifting macroeconomic conditions are clouding the economic outlook,even as the global picture shows slight signs of improvement.Persistently high inflat

4、ion has prompted the most aggressive interest rate hikes in decades,causing financial conditions to tighten sharply and exacerbating debt vulnerabilities.While economic prospects remain subdued,the slowdown in global growth in 2023 is likely to be less severe than previously expected,mainly due to r

5、esilient household spending in developed economies and recovery in China.Global growth is now projected to slow from 3.1 per cent in 2022 to 2.3 per cent in 2023,an upward revision by 0.4 percentage points from the January forecast.Global inflation is projected to decline from 7.5 per cent in 2022 t

6、o 5.2 per cent in 2023,mainly due to lower food and energy prices and softening global demand.Amid easing inflationary pressures,the global economy is expected to pick up some momentum in 2024,but at 2.5 per cent,growth is projected to remain well below the longer-term(2000-2019)average of 3.1 per c

7、ent.Against a backdrop of multiple interconnected crises and heightened macroeconomic uncertainties,monetary and fiscal policy challenges have further intensified.The recent banking sector turmoil in the United States and Europe has illustrated fragilities in the financial system,complicating the tr

8、ade-off for central banks between fighting inflation and preserving financial stability.After a decade of loose monetary policy with low interest rates and quantitative easing in developed countries,which encouraged excessive leverage in the financial sector and generated negative global spillovers,

9、the prospect of high interest rates and quantitative tightening now poses a massive challenge for developing countries.Lack of access to affordable finance limits the ability of many governments to invest in education,health,sustainable infrastructure and the energy transition,while threatening to p

10、ush a growing number of countries into debt default.SummaryIII ContentsSummary.IIGlobal macroeconomic trends.1Global overview .1Inflation and commodity prices.5Labour markets .6International trade.7International financial markets .8Monetary and fiscal policy:trends and challenges.9Spillover effects

11、of unconventional monetary policy.11Developed countries:transmission channels and impacts of quantitative easing .12Developing countries:spillovers of quantitative easing.13From QE to QT:a bumpy road .14Policy challenges for the developing countries.15Regional economic outlook .17Developed economies

12、.17United States.17Europe .17Developed Asia and the Pacific.18Economies in transition .18Developing economies .19Africa .19East Asia .19South Asia .20Western Asia.20Latin America and the Caribbean .21Table 1.Growth of world output,20212024.4Figures 1.Growth of economic output in the world,developed

13、and developing countries.1 2.Consumer confidence and manufacturing Purchasing Managers Index in selected economies 2 3.Growth of gross domestic product per capita by region and country grouping.3 4.Annual inflation by region and country grouping.5 5.Change in employment rates in selected economies,Q

14、4 2019 vs Q4 2022 .7 6.Global supply chain pressure index and global container freight index .8 7.Non-resident portfolio flows to emerging economies.8 8.Policy rate changes by central banks.9 9.Total assets of major developed country central banks.12 10.Growth of fixed capital formation in selected

15、developed economies .13 11.Credit to non-financial sectors as a share of GDP in emerging economies.14 12.External debt stock in developing economies.14 13.Policy rate changes in selected regions and country groupings .161GLOBAL MACROECONOMIC TRENDSGlobal macroeconomic trendsGlobal overviewUncertaint

16、ies and poor growth prospects continue to bedevil the world economy.A confluence of factors the long reach of the COVID-19 pandemic,the lingering war in Ukraine,the ever-worsening impacts of climate change,and growing policy challenges has pushed many countries to the brink,even as the global pictur

17、e shows slight improvement.Stubbornly high inflation in both developed and developing countries in the aftermath of the pandemic prompted the most aggressive interest rate hikes in decades.Despite rising rates,household spending and employment especially in the developed economies have remained resi

18、lient,making it harder for central banks to tame inflation.Against this backdrop,the deceleration in global growth for 2023 as projected earlier is likely to be less severe than previously anticipated,mainly due to persistently robust household spending in the largest economies,especially in the Uni

19、ted States and the European Union,as well as the recovery in China.Global growth is now projected to slow from 3.1percent in 2022 to 2.3percent in 2023(up from 1.9percent forecast in January)(figure 1).Figure 1Growth of economic output in the world,developedand developing countriesSource:UN DESA,bas

20、ed on estimates and forecasts produced with theWorld Economic Forecasting Model.Note:e=estimates,f=forecasts.Percentage-6-4-20246820152016201720182019202020212022e2023f2024fDeveloping economiesDeveloped economiesWorldWESP mid-2023WESP 2023ProjectionsThe global economy is predicted to pick up some mo

21、mentum,expanding by 2.5percent in 2024,with inflationary pressures easing during the second half of 2023.This rate is,however,2WORLD ECONOMIC SITUATION AND PROSPECTS AS OF MID-2023well below the worlds longer-term(2000-2019)average growth rate of 3.1percent.As structural challenges including scarrin

22、g from the pandemic,subdued investment,mounting debt vulnerabilities and funding shortages,remain unaddressed,the world economy is facing the risk of a prolonged period of subpar growth.1 Slow income growth,in turn,would further undermine prospects for progress towards poverty eradication and other

23、Sustainable Development Goals.After declining steadily in 2022,consumer confidence slightly improved in recent months in most major economies,helped by lower international energy and food prices(figure 2a).However,consumer confidence levels remain far below their long-term averages.At the same 1 Uni

24、ted Nations(2023).World Economic Situation and Prospects 2023.New York:United Nations.time,manufacturing activity,as measured by the Purchasing Managers Index,which saw an uptick following Chinas reopening,appears to have bottomed out(figure 2b).Meanwhile,global financial markets have remained large

25、ly resilient despite ongoing banking sector turmoil in the United States and Europe.In March 2023,the collapse of the Silicon Valley Bank,the 16th largest bank in the United States by total assets,and Signature Bank as well as the Swiss government-brokered takeover of Credit Suisse,a globally system

26、ically important bank,rattled financial markets worldwide.In early May,the United States Government seized control of First Republic Bank,with total assets of$212 billion and sold it to JPMorgan Chase.While governments and financial regulators managed Figure 2Consumer confidence and manufacturing Pu

27、rchasing Managers Index in selected economiesSource:UN DESA,based on data from the Organisation for EconomicCo-operation and Development(OECD).Note:The(long-term)average value from Jan 2014 until March 2023equals 100.a)Consumer confidenceb)Manufacturing Purchasing Managers IndexIndex,Jan 2014 Mar 20

28、23=1009092949698100102104106Dec-19Jun-20Dec-20Jun-21Dec-21Jun-22Dec-22ChinaEuro areaUnited StatesJapanSource:UN DESA,based on data from CEIC.Note:The manufacturing Purchasing Managers Index(PMI)is a weightedaverage of five subindices:new orders,output,employment,suppliersdelivery times and stocks of

29、 purchases.Country group data are weightedaverages of individual country PMIs,produced by S&P Global.A value below50 signals a contraction of activities compared to the previous month.35404550556065Dec-19Jun-20Dec-20Jun-21Dec-21Jun-22Dec-22GlobalDeveloped marketsEmerging marketsIndex,seasonally adju

30、sted3GLOBAL MACROECONOMIC TRENDSto contain the turmoil,these developments show the potential of more systemic financial stability risks.Despite the market turmoil,the Federal Reserve and other developed country central banks continued to raise policy rates as core inflation has remained high and mor

31、e persistent than expected.While the major central banks have slowed the pace of monetary tightening,further rate hikes remain likely in 2023.The slightly improved outlook for global growth in 2023 primarily reflects upward revisions in the major developed countries and China(table 1).In the United

32、States,consumer spending and non-residential investment have proven more resilient than expected,prompting upward revision of the growth forecast to 1.1percent in 2023(up from 0.4percent forecast in January).However,amid tightening financial conditions and further adjustments in house prices,consume

33、r spending is projected to soften,weighing on growth prospects.In Europe,lower gas prices and robust consumer spending,especially on services,have prevented the sharp slowdown that had been forecast in January.The European Unions economy is now projected to grow by 0.9percent in 2023(up from 0.2perc

34、ent forecast in January).After lifting COVID-19-related restrictions in December 2022,Chinas GDP expanded faster than expected in the first quarter of 2023.Annual growth this year is now forecast at 5.3percent(up from 4.8percent forecast in January).Improved short-term prospects in the worlds three

35、largest economies contrast with downward revisions to growth in many developing countries.GDP per capita is projected to grow only marginally in Africa and Latin America and the Caribbean in 2023,reinforcing a long-term trend of weak economic performance(figure 3).Source:UN DESA,based on estimates a

36、nd forecasts produced with the World Economic Forecasting Model.Note:e=estimates,f=forecasts.Data for Libya is excluded.Figure 3Growth of gross domestic product per capita by region and country grouping20202021Percentage2022e2023f1.33.94.01.96.44.21.81.2-8-6-4-202468DevelopedeconomiesEconomiesin tra

37、nsitionDevelopingeconomiesAfricaEastAsiaSouthAsiaWesternAsiaLatin Americaand theCaribbeanAverage 2000-20194WORLD ECONOMIC SITUATION AND PROSPECTS AS OF MID-2023Table 1Growth of world output,20212024Change from the World Economic Situation and Prospects 2023Annual percentage change20212022a2023b2024b

38、20232024World6.13.12.32.50.4-0.2Developed economies5.42.71.01.20.6-0.4United States of America5.92.11.11.00.7-0.7Japan2.11.11.21.0-0.3-0.3European Union5.43.50.91.50.7-0.1Euro area5.43.50.91.40.8-0.2United Kingdom of Great Britain and Northern Ireland7.64.0-0.11.10.70.1Other developed countries4.93.

39、21.31.40.1-0.4Economies in transition5.5-1.70.62.2.South-Eastern Europe7.43.22.03.0-0.30.2Commonwealth of Independent States and Georgia5.4-1.90.62.2.Russian Federation5.6-2.1-0.61.42.3-0.1Developing economies7.13.94.14.20.20.1Africac4.73.53.43.5-0.4-0.3North Africac5.43.13.33.4-0.8-0.3East Africa5.

40、55.15.04.9-0.10.0Central Africa1.83.13.53.60.10.2West Africa4.33.83.83.90.0-0.1Southern Africa4.32.71.92.3-0.4-0.4East and South Asia7.33.64.74.50.3-0.1East Asia7.33.24.74.30.30.0China8.43.05.34.50.50.0South Asiad7.55.64.75.8-0.1-0.1Indiad8.96.85.86.70.00.0Western Asia6.36.63.13.3-0.4-0.1Latin Ameri

41、ca and Caribbean6.63.81.42.40.0-0.1South America7.03.81.02.2-0.1-0.3Brazil4.62.91.02.10.10.1Mexico and Central America5.83.32.02.60.40.1Caribbean5.110.68.06.20.10.4Least developed countries2.84.34.15.2-0.3-0.2Memorandum items:World tradee10.65.02.33.62.71.1World output growth with PPP weightsf6.23.3

42、2.73.00.4-0.2Source:UN DESA,based on estimates and forecasts produced with the World Economic Forecasting Model.Notes:(a)Partially estimated,(b)forecast,(c)excludes Libya,(d)calendar year basis,(e)includes goods and services and(f)based on a 2015 benchmark.5GLOBAL MACROECONOMIC TRENDSUnsustainable d

43、ebt servicing burdens,mounting balance-of-payments pressures,growing financing gaps and constrained fiscal space will continue to undermine near-term growth prospects of many developing countries.Inflation and commodity pricesWhile inflation has been easing in recent months,it is expected to remain

44、above central bank targets in 2023.Global inflation is projected to decline from 7.5percent in 2022 to 5.2percent in 2023,mainly due to lower food and energy prices and softening global demand.Inflation will,however,remain well above the 2000-2019 average of 3.1percent(figure 4).Global food prices h

45、ave been falling since mid-2022 owing to several factors,including the resumption of exports from Ukrainian ports under the Black Sea Grain Initiative.The FAO Food Price Index declined by 20percent year-on-year in March 2023 to 126.9,the lowest value since July 2021.Although the unexpected OPEC+prod

46、uction cut in April coupled with the European Unions ban on Russian crude exerted temporary upward pressures on prices,oil prices continued to drop.Between January and early May 2023,Brent crude oil prices fell 16percent to about$75 per barrel,the lowest level since December 2021.In developed countr

47、ies,headline inflation is expected to decline gradually from 7.8percent Figure 4Annual inflation by region and country groupingSource:UN DESA,based on estimates and forecasts produced with the World Economic Forecasting Model.Note:e=estimates,f=forecasts.Regional averages are GDP-weighted.Data for A

48、rgentina,Sudan,Trkiye and the Bolivarian Republic of Venezuelaare excluded.2022e2023fAverage 2000-2019Percentage024681012141618WorldDevelopedeconomiesEconomiesin transitionDevelopingeconomiesAfricaEastAsiaSouthAsiaWesternAsiaLatin Americaand theCaribbean6WORLD ECONOMIC SITUATION AND PROSPECTS AS OF

49、MID-2023in 2022 to 4.8percent in 2023 but will remain well above central bank targets,typically around 2percent.In the United States,headline inflation has been easing over the past year,falling to 5.0percent in March 2023,the lowest rate since May 2021.In the European Union,inflation declined to 8.

50、3percent in March,ranging from about 3percent in Luxembourg and Spain to 25.6percent in Hungary.While headline inflation rates have been falling,core inflation in the United States and Europe remains high,mainly driven by rising service prices(e.g.,housing,insurance,transport)and robust wage growth.

51、Inflation is also trending downward in most developing countries amid lower commodity prices and reduced global supply constraints and depreciation pressures.Annual inflation will,however,remain well above the long-term average,especially in Western Asia,South Asia,and Africa(figure 4).Although glob

52、al food prices have been declining since mid-2022,domestic food inflation has often stayed elevated due to a number of factors,including still-high import costs,local supply disruptions,and market imperfections.According to the World Bank,food inflation in early 2023 remained above 5percent in about

53、 90percent of developing countries.2 Continuing high inflation in developing countries that are home to large numbers of people in poverty represents an additional barrier to poverty eradication.Emerging evidence from countries affected by the current episode of high food prices reconfirms earlier e

54、vidence that women and children are the worst affected by the resulting hunger and malnutrition.3Labour marketsLabour markets in Europe,Japan and North America have remained tight,with low unemployment rates and recurrent worker 2 World Bank(2023).Food Security Update.April 6.Washington,DC:World Ban

55、k.3 United Nations Entity for Gender Equality and the Empowerment of Women(UN Women)(2022).Global Gendered Impacts of the Ukraine Crisis.New York:UN Women.4 European Foundation for the Improvement of Living and Working Conditions(Eurofound)(2022).COVID-19 Pandemic and the Gender Divide at Work and H

56、ome.Loughlinstown,Ireland:Eurofound.shortages.Post-pandemic mismatches between labour supply and labour demand in these countries exerting upward pressures on wages pose additional policy challenges to central banks striving to bring down inflation.Except for the United States and the United Kingdom

57、,employment rates in developed economies were well above pre-pandemic levels at the end of 2022.As shown in Figure 5,in many developed economies,employment rates increased more among women than men,narrowing the gender gap in employment rates.This is a result of a steeper decrease in the employment

58、rate between 2019 and 2020 and a weaker recovery between 2020 and 2022 for men,which can be due to a combination of factors such as the gender differences in sector of employment,as well as policy responses,including telework and flexible working arrangements.However,even though the gender gap in em

59、ployment rates has narrowed,women still cover a disproportionate share of unpaid work,and this discrepancy has prevailed during the pandemic.4In the United States,the unemployment rate declined to 3.5percent in March 2023,despite a steady increase in labour force participation,which almost reached p

60、re-COVID levels.Monetary tightening by the Federal Reserve,however,started to take a toll on employment in sectors construction,manufacturing,and retail that heavily rely on bank credit to finance their operations.As economic activity softens,the unemployment rate in the United States is projected t

61、o increase moderately during the forecast period but will remain low by historical standards.In Europe,unemployment has also fallen to record-low levels in many countries,averaging 6.5percent in the euro area in March 2023.Although some European economies may experience a mild recession in 2023,labo

62、ur market conditions are expected to 7GLOBAL MACROECONOMIC TRENDSremain resilient,as businesses will likely retain workers amid significant labour shortages.5In China,the easing of pandemic-related restrictions has led to a marked decline in the urban unemployment rate to about 5.5percent in early 2

63、023,which is,however,still above the pre-pandemic level of 4-5percent.Labour market conditions remain challenging in many parts of Africa,with high rates of informality,gender gaps and rising youth unemployment.On the positive side,the unemployment rate in South Africa declined for four consecutive

64、quarters in 2022,reaching a two-year low.5 European Labour Authority(2023).Report on Labour Shortages and Surpluses 2022.Luxembourg:Publications Office of the European Union.International tradeGlobal trade is expected to remain under pressure in the forecast period.The baseline scenario projects tha

65、t the volume of global trade in goods and services will grow by 2.3percent in 2023,slightly higher than the previous forecast of near zero growth.This reflects the upward revision to GDP growth projections.Furthermore,Chinas reopening is expected to increase domestic demand and potentially boost glo

66、bal trade with increased imports of goods and services.However,the lingering effects of COVID-19,rising geopolitical tensions,and monetary tightening will continue to hold back global trade,although supply chain constraints Source:UN DESA,based on data from the Organisation for Economic Co-operation

67、 and Development(OECD).Note:The figure shows the change in the employment rate for the age group 15-64 between the fourth quarter of 2019 and the fourth quarter of 2022.Figure 5Change in employment rates in selected economies,Q4 2019 vs Q4 2022WomenMen-2-10123456UnitedStatesUnitedKingdomJapanSpainGe

68、rmanyFranceItalyEuropeanUnionRepublicof KoreaAustraliaGreecePolandPercentage points8WORLD ECONOMIC SITUATION AND PROSPECTS AS OF MID-2023and high shipping costs have eased(figure 6).Trade in services experienced faster growth than trade in goods,supported by further recovery in travel and tourism se

69、ctors.International tourism is set to consolidate its recovery in 2023,backed by pent-up demand,particularly from Asia and the Pacific as destinations and markets open up.United Nations World Tourism Organization(UNWTO)estimates that international tourism arrivals could reach 80 to 95percent of pre-

70、pandemic levels in 2023.6International financial marketsWith energy prices and inflation gradually softening,international capital markets have been expecting a pause or even a reversal of monetary tightening in the developed economies.While this has remained elusive,prospects of slowing inflation h

71、ave reduced 6 UNWTO(2023).Tourism Set to Return to Pre-Pandemic Levels in Some Regions in 2023.17 January 2023.7 IMF(2023).Emerging and Frontier Markets Issuance.Global Markets Analysis,7 February 2023.Washington,DC:IMF.investors risk aversion as well as long-term interest rates.Capital flows to dev

72、eloping countries recovered(figure 7),albeit with significant volatility,reversing the decline in the first half of 2022.New sovereign bond issuances from emerging economies totalled$39.8 billion in January 2023,the second highest level on record.7 Many developing country currencies also recouped so

73、me of the losses suffered throughout most of 2022.Between October 2022 and March 2023,the nominal U.S.dollar index against emerging market currencies fell by 6percent,but it still remains about 5percent above the level of January 2021.However,as major central banks further increased interest rates i

74、n recent months,global financial conditions have continued to tighten.In March 2023,the collapse of Silicon Valley Bank(SVB)and Signature Bank in the United States and the near-failure of Credit Suisse sent shock waves through the global financial Source:UN DESA,based on data from Federal Reserve Ba

75、nk of New Yorkand CEIC.Note:LHS=left-hand scale,RHS=right-hand scale.Figure 6Global supply chain pressure index and globalcontainer freight indexStandard deviations from average value(Jan 1998 to March 2023)Price index,United States dollarsGlobal supply chainpressure index(LHS)Global containerfreigh

76、t index(RHS)-4,000-2,00002,0004,0006,0008,00010,00012,000-2-10123456Jan2019Jul2019Jan2020Jul2020Jan2021Jul2021Jan2022Jul2022Jan2023Figure 7Non-resident portfolio flows to emergingeconomiesSource:UN DESA,based on data from the Institute of InternationalFinance(IIF).Note:A list of the countries classi

77、fied as emerging economies isavailable on the IIF website.Billions of United States dollarsDebt flowsPortfolio flows(3-month moving average)Equity flows-20020406080Jan2021Apr2021Jul2021Oct2021Jan2022Apr2022Jul2022Oct2022Jan2023Apr20239GLOBAL MACROECONOMIC TRENDSsector.Rapidly rising interest rates e

78、xacerbated the asset-liability mismatches and exposed balance sheet vulnerabilities and failures in risk management in the failed banks.The fear of contagion prompted swift and decisive actions by regulators,which minimized any threats to financial stability.In the United States,the Federal Deposit

79、Insurance Corporation expanded deposit protection to all depositors at the failed banks instead of only those below$250,000.8 The Federal Reserve also briefly reversed its balance sheet shrinking under the quantitative tightening programme,which had been started in April 2022.After reducing its bala

80、nce sheet by$623 billion between April 11,2022 and March 6,2023,the Federal Reserve expanded the balance sheet by$364 billion during March 10-27 20239 following the failure of SVB-to provide liquidity and stabilize the financial sector.The banking sector,especially in the United States,has,however,r

81、emained under pressure as evidenced by the failure of First Republic Bank in early May 2023.The turmoil in regional banks does not present any systemic risks as balance sheets of the countrys largest banks have remained strong,but will likely further constrain credit growth in the near term.Financia

82、l conditions in emerging economies with good credit ratings have generally remained relatively stable in the aftermath of such turbulence.However,some economies experienced a rise in credit spreads,further limiting their access to finance.In March,credit spreads in“frontier markets”widened by 120 ba

83、sis points.10 Several developing economies,for example Nigeria and Kenya,decided to postpone plans to issue new sovereign bonds,amid a significant increase in credit spreads.11 According to the IMF,there are currently 12 sovereign bonds trading at distressed spreads of more than 1,000 basis points a

84、nd an additional 20 bonds trading at spreads of more than 700 basis points.12 The reverberations from the banking 8 Such an expansion arguably increased the prospects of moral hazard and excessive risk-taking going forward.9 Data source:Board of Governors of the Federal Reserve System,Credit and Liq

85、uidity Programs and the Balance Sheet,Recent Balance Sheet Trends.10 IMF(2023).Emerging and Frontier Markets Issuance.Global Markets Analysis,5 April 2023.Washington,DC:IMF.11 Muir,M.(2023).Quarter of Emerging Countries Lose Effective Access to Debt Markets.Financial Times,31 March 2023.12 IMF(2023)

86、.Global Financial Stability Report 2023.11 April 2023.Washington,DC:IMF.sector turmoil in the developed economies have thus further impaired financing conditions in many developing economies.Monetary and fiscal policy:trends and challengesCentral banks in developed and developing countries have cont

87、inued to tighten monetary policy in 2023 to anchor inflation expectations and maintain credibility.However,most central banks have reduced the pace of their interest rate hikes as headline inflation figures have gradually eased(figure 8).In the United States,the Federal Reserve raised interest rates

88、 by only 25 basis points in January,March and May,after several earlier rate hikes of 75 basis points in Source:UN DESA,based on data from CEIC.Note:The policy rate changes refer to the net sum of all central bankspolicy changes in each period and country category.The figure coversa total of 78 cent

89、ral banks.Figure 8Policy rate changes by central banksPercentage pointsDeveloped economiesEconomies in transitionDeveloping economies-60-40-20020406080Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1202020212022202310WORLD ECONOMIC SITUATION AND PROSPECTS AS OF MID-20232022,and hinted at a pause in the tightening cycle.T

90、he European Central Bank also shifted to a smaller 25 basis points hike in May,following three consecutive hikes of 50 basis points.Several developing country central banks have also adopted a more cautious approach,while others-especially in Latin America-have paused rate hikes.The recent banking s

91、ector turmoil in the United States and Europe has exposed the trade-offs between raising policy rates and preserving financial stability.A decade of ultra-loose monetary policy and near-zero policy rates has encouraged excessive leverage in the financial sector.The sudden shift to monetary tightenin

92、g and rising interest rates has exposed asset-liability mismatches and exposed the financial sector to significant duration risks.13Over the forecast period,monetary policy stances are expected to diverge.In the major developed economies,the tightening cycle is well advanced:the Federal Reserve is p

93、rojected to implement one or two more rate hikes this year while in the euro area,interest rates may peak in the third quarter of 2023.An end to monetary tightening in developed economies would allow some developing country central banks to recalibrate their monetary stances to support economic grow

94、th while others will continue to raise interest rates amid stubbornly high inflation.In 2022,fiscal trends across the world were driven by continued economic recovery from the COVID-19 crisis,the impact of unexpected inflation on debt dynamics(which particularly 13 Duration risk measures how much bo

95、nd prices are likely to change if and when interest rates move.benefitted developed economies),and tighter fiscal stances as pandemic-related support measures were phased out.Average fiscal deficits and public debt levels as a share of GDP declined for a second consecutive year in both developed and

96、 developing countries.Commodity producers,especially oil-rich countries,experienced particularly large improvements in fiscal performance.Global public debt stood at an estimated 92.1percent of GDP in 2022,7.6 percentage points below the 2020 level,but still notably higher than the pre-pandemic leve

97、l of 84.3percent.These aggregate short-term trends should not obscure an increasingly challenging fiscal outlook,especially for developing countries facing weak and diminished growth prospects.The aggressive tightening of global monetary policy since early 2022 has significantly exacerbated fiscal a

98、nd debt vulnerabilities and further constrained fiscal space in many countries,especially in sub-Saharan Africa,South Asia,and Latin America and the Caribbean.Borrowing costs have risen sharply and the strong dollar despite some softening in recent months has pushed up the debt-servicing burden of d

99、ollar-denominated debt.In Africa,external debt service as a share of government revenue has risen sharply,while access to development assistance and private finance has diminished.Financing constraints will limit the ability of governments to invest in education,health,sustainable infrastructure and

100、 energy transition and accelerate progress towards sustainable development,while threatening to push a growing number of countries into debt default.11SPILLOVER EFFECTS OF UNCONVENTIONAL MONETARY POLICYSpillover effects of unconventional monetary policyAfter decades of quiescence,high inflation made

101、 a comeback in 2022.Major developed country central banks began to raise interest rates and also reduce liquidity in the financial market,by selling off assets on their balance sheets,pursuing a process known as quantitative tightening(QT).However,QT has proved to be challenging given the years of u

102、ltra-loose monetary policy of quantitative easing(QE),undertaken through programmes that injected trillions of dollars of liquidity since the global financial crisis(GFC)in 2008.The transition from QE to QT in the developed economies will likely be particularly challenging for many developing countr

103、ies as it will significantly tighten global financial conditions,increase their borrowing costs and exacerbate debt sustainability risks.Developed country central banks first resorted to unconventional monetary policy measures when policy rates reached or approached the zero lower bound.By purchasin

104、g government bonds or other financial assets,QE aimed to increase liquidity and stimulate economic activity.Notably,in response to a prolonged period of economic stagnation and deflation,the Bank of Japan(BoJ)first implemented QE in 2001.During the GFC,QE-through asset purchases by central banks-bec

105、ame the monetary policy tool of choice.In the United States,the Federal Reserve needed to restore the balance sheets of the too-big-to-fail banks,as many of them held trillions of dollars of mortgage-backed securities(MBS)that lost value before the crisis.It recognized that lowering policy interest

106、rates,though necessary,alone would not solve the balance sheet challenges of the banks that held these securities.There was limited liquidity in the market to support the prices of these MBS.With sharply falling MBS prices,long-term interest rates surged.The Federal Reserve began to buy these MBS se

107、curities that no market participant wanted to buy and hold to shore up the balance sheets of the banks and reduce long-term interest rates.Other developed country central banks notably the European Central Bank(ECB)and the Bank of England(BoE)followed the lead of the Federal Reserve to support their

108、 financial sector during the crisis in 2008.In the aftermath of the GFC,QE has remained a key monetary policy tool for developed country central banks,with some changes in strategy,including announcement to taper asset purchases in 2013,and balance sheet normalisation in 2017 by the Federal Reserve.

109、During the pandemic,with record-low policy rates,many central banks implemented massive QE as a way to provide economic stimulus,even 12WORLD ECONOMIC SITUATION AND PROSPECTS AS OF MID-2023though the balance sheets of commercial banks remained strong.Between January 2020 and December 2021,the Federa

110、l Reserve,ECB and BoE doubled or nearly doubled the assets on their balance sheets.As of end 2021,the total assets of the Federal Reserve,ECB,BoE and BoJ reached about$8.8 trillion,$9.6 trillion,$1.5 trillion and$6.3 trillion,respectively(figure 9),collectively representing about a quarter of world

111、GDP.Facing deteriorating global financial conditions,large capital outflows and rising borrowing costs during the pandemic,27 developing countries introduced QE for the first time during the pandemic in 2020.14Figure 9Total assets of major developed country centralbanks Trillions of United States do

112、llarsSource:UN DESA,based on data from Federal Reserve,European CentralBank,Bank of England,Bank of Japan,CEIC and Trading Economics.Note:All assets are converted into United States dollars by using theexchange rate of the corresponding period.Federal ReserveEuropean Central BankBank of EnglandBank

113、of Japan04812162024282008201020122014201620182020202214 United Nations(2022).World Economic Situation and Prospects 2022.New York:United Nations.15 Data source:CEIC.16 Christensen,J.H.E.and Gillan,J.M.(2019).Does Quantitative Easing Affect Market Liquidity?Federal Reserve Bank of San Francisco Worki

114、ng Paper.Han,F.and Seneviratne,D.(2018).Scarcity Effects of Quantitative Easing on Market Liquidity:Evidence from the Japanese Government Bond Market.IMF Working Paper 18/96.The paper also finds that QE may reduce market liquidity when the increase in a central banks holdings of certain securities l

115、eads to a scarcity of those securities and hence higher search costs in the market.17 Krishnamurthy,A.and Vissing-Jorgensen,A.(2011).The Effects of Quantitative Easing on Interest Rates:Channels and Implications for Policy.Brookings Papers on Economic Activity,Fall 2011.Krishnamurthy,A.and Vissing-J

116、orgensen,A.(2013).The Ins and Outs of Large Scale Asset Purchases.Kansas City Federal Reserve Symposium on Global Dimensions of Unconventional Monetary Policy,2013.Developed countries:transmission channels and impacts of quantitative easingWith QE,the central banks pursued two objectives in the afte

117、rmath of the global financial crisis:a.restore financial stability and b.boost investment and economic growth by lowering long-term borrowing costs.The QE interacted with the real economy through multiple channels:First,the liquidity channel,increasing money supply and liquidity with a view to easin

118、g financial market stress and preventing liquidity shortages particularly during the immediate crisis phase.Second,the portfolio rebalancing channel,changing the relative prices of financial assets and encouraging investors to hold long-term assets by lowering their yields.Third,the signalling chann

119、el,conveying the central banks commitment to stabilizing financial markets and supporting the economy.QE has been proven to be an important monetary policy tool to address financial distress particularly during crisis times.Between 2007 and 2021,broad money as a percentage of GDP increased from 79.5

120、percent to 117percent in the United States,and from 90percent to 124percent in the euro area.15 Various studies find that QE can improve market liquidity by relaxing bank funding constraints,increasing risk appetite,lowering liquidity premium among others.16QE had a large impact on bond yields.Resea

121、rch by Krishnamurthy and Vissing-Jorgensen illustrates that the first and third QE by the Federal Reserve decreased MBS and Treasury yields.17 Moreover,in the United States,banks that owned more MBS prior to QE had faster growth in loans to the private sector than those 13SPILLOVER EFFECTS OF UNCONV

122、ENTIONAL MONETARY POLICYthat had little or no MBS holdings,indicating that QE was able to stimulate additional credit provision.18 However,lower yields and additional credit may not necessarily support productive investments in the medium to long term when many other factors also come into play.Duri

123、ng the QE episodes of the past 15 years,growth of fixed capital formation in major economies decreased compared to the pre-crisis period(figure 10).Figure 10Growth of fixed capital formation in selecteddeveloped economiesPercentageSource:UN DESA.Note:The figure shows average annual growth rates(usin

124、g geometricaverage).1998-20072010-2019012345Euro areaUnited KingdomUnited StatesOver this period,as investors searched for stronger returns and rebalanced their portfolios with riskier assets,additional liquidity flowed into financial sectors and real estate markets,contributing to pushing up asset

125、prices.In the 10 years after the first round of QE,the S&P 500 rose by over 200percent and the Dow Jones Euro Stoxx Index nearly doubled.Between the 18 Darmouni,A.and Rodnyansky,O.M.(2017).The Effects of Quantitative Easing on Bank Lending Behavior.The Review of Financial Studies,Vol.30,Iss.11,pp.38

126、58-3887.19 For instance,the MSCI Emerging Markets Index,which traces stock market performance in 25 developing countries,doubled in the decade after the QE was implemented in the developed economies during the GFC.last QE introduced during the pandemic and the end of 2021,the S&P 500 nearly doubled

127、and the Dow Jones Euro Stoxx Index increased by about 50percent.Similar movements were also seen in real estate prices in the United States and Europe,with additional liquidity chasing available housing stocks.Developing countries:spillovers of quantitative easingQE boosted global liquidity.As long-

128、term interest rates remained near zero in the developed economies,investors search for higher yields contributed to higher asset prices in the developing countries.19 Many developing country governments and corporates began to borrow in the international capital market.Increased external borrowing a

129、nd inflow of foreign portfolio capital often led to exchange rate appreciation,making imports cheaper and exports more expensive and adversely affecting the balance-of-payments of many developing countries.In principle,increased global liquidity could lower borrowing costs for some developing countr

130、ies,especially those with access to international financial markets and strong macroeconomic fundamentals.Yet,while such inflows helped to bridge financing gaps in the short run,they also contributed to increases in external debt.Between 2007 and 2020,total debt of governments,firms and households i

131、ncreased from 125percent of GDP to 243percent of GDP(figure 11).During the same period,the stock of international bonds of the developing countries increased by over 200percent to about$7.5 trillion(figure 12).Many developing countries continued to pay high and rising risk premia during QE,even thou

132、gh interest rates in the developed 14WORLD ECONOMIC SITUATION AND PROSPECTS AS OF MID-2023economies remained near zero during the decade before the pandemic.For instance,in 2007 before QE,Ghana issued a sovereign bond that paid 8.5percent interest,while in 2015 it issued a bond in the international

133、capital market that paid 10.75percent interest.Other countries in sub-Saharan Africa for example Angola,Senegal and Zambia experienced higher external borrowing cost during the QE period.These countries faced even higher borrowing costs during crises.For instance,the yield on Zambias sovereign bonds

134、 remained between 14percent and 28percent between 2007 and 2019 and surged to about 35percent during the pandemic.20 Persistently high borrowing costs have exacerbated the debt sustainability risks of many developing countries.As of February 2023,36 out of 69 countries covered by the Debt 20 Data so

135、urce:CEIC.21 IMF(2023).List of LIC DSAs for PRGT-Eligible Countries,as of February 28,2023.22 Including$60 billion of Treasuries and$35 billion of MBS.Sustainability Framework for Low-Income Countries were in debt distress or at high risk of experiencing debt distress.21From QE to QT:a bumpy roadThe

136、 Federal Reserve attempted to wean the financial sector from QE in 2013,but it triggered the so-called“taper tantrum”.In 2017,the Federal Reserve started balance sheet normalisation and managed to reduce its total assets by about$700 billion from nearly$4.5 trillion in October 2017 to$3.8 trillion i

137、n August 2019(figure 9).After a massive expansion of its balance sheet during the pandemic,the Federal Reserve began its new round of QT in April 2022.It announced plans to reduce its asset holdings by about$95 billion a month,22 roughly double Figure 11Credit to non-financial sectors as a share of

138、GDP inemerging economiesPercentageSource:UN DESA,based on data from the Bank for InternationalSettlements(BIS).Note:The countries classified as emerging economies can be found on theBIS website.Credit to non-financial corporationsCredit to householdsCredit to general government0501001502002502008201

139、0201220142016201820202022Figure 12External debt stock in developing economiesSource:UN DESA,based on data from the World Bank World DevelopmentIndicators database.Note:External debt stock estimates cover 94 developing economies.Trillions of United States dollars01234567892007200920112013201520172019

140、202115SPILLOVER EFFECTS OF UNCONVENTIONAL MONETARY POLICYthe maximum pace of$50 billion a month23 it had targeted during 2017-2019.BoE and ECB also began QT for the first time in late 2022 and early 2023,respectively.Unwinding of QE has however proved to be challenging,and will take monetary authori

141、ties into uncharted territory.As QE had lowered yields and increased prices of riskier assets,QT may be expected to do the opposite.Abrupt asset price corrections may trigger financial instability and force central banks to pause or even reverse QT.Between 2017 and 2019,quick interest rate hikes and

142、 QT in the United States were accompanied by significant volatility and uncertainty in the stock market.In late 2018,a sharp sell-off in the global equity markets led to significant declines in equity prices.Concerns of financial market instability partly forced the Federal Reserve to abandon QT in

143、2019.More recently,the collapse of Silicon Valley Bank in March 2023 disrupted the Federal Reserves efforts to shrink its balance sheet.Abrupt asset price corrections could trigger a spiral of credit defaults and increase financial risks.24 Such a scenario could be especially disquieting in conditio

144、ns like those in the United States where,despite interest rate hikes for about a year,credit card debt hit a record high-in early April 2023,consumer loans by credit cards totalled just under$1 trillion,compared with$850 billion a year ago.25 Near zero interest rates and abundant liquidity during QE

145、 could also have made monetary policy responses based on the Taylor Rule26 less effective in reducing consumption demand and bringing down inflation.Transitioning from QE to QT may require a careful recalibration of all monetary policy tools,including the Taylor Rule.It is also unclear whether QT ca

146、n boost long-term interest rates since many transmission 23 Including$30 billion of Treasuries and$20 billion of MBS.24 Valckx,N.(2017).Rising Household Debt:What It Means for Growth and Stability.IMF blog.25 Inflation could have also contributed to higher credit card debt in the United States.26 Th

147、e Taylor Rule,created by American economist John Taylor in 1993,prescribes how policymakers should set and adjust the short-term policy rate in response to the values of a few key economic variables.It suggests that the target nominal policy rate should be dependent on the level of the real neutral

148、interest rate,expected inflation,and deviations of inflation and output from their respective target levels.27 Ono,N.and Pina,A.(2022).Quantitative Tightening:Another Driver of Higher Interest Rates?OECD Ecoscope blog.28 IMF(2023).Global Financial Stability Report 2023.11 April 2023.Washington,DC:IM

149、F.channels are involved.27 Although both short-term and long-term government bond yields increased during the policy rate hikes in the United States,long-term government bond yields rose at a slower pace,generating an inverted yield curve.The inverted yield curve and the persistence of compressed te

150、rm premiums reflect investors preference for holding safe“shorter”duration sovereign bonds amid a still uncertain economic outlook.28The collapse of Silicon Valley Bank in the United States has also exposed significant duration risks in the financial sector.Rising short-term rates are reducing the p

151、rice of long-term bonds held by banks and other investors.This will lead to balance sheet losses and may trigger financial turmoil,especially if the financial intermediaries are forced to sell their long-term bond holdings.These risks will weigh on long-term economic growth,with investors shying awa

152、y from holding long-term assets.Policy challenges for the developing countriesQE in developed economies was associated with large capital inflows to developing countries,leading to currency appreciation and lower export competitiveness.Developing country central banks aiming to keep capital flowing

153、into the country were often unable to take appropriate prudential measures to prevent excessive borrowing and consequent exchange rate appreciations.Instead,many central banks maintained tight monetary policy stances to prevent inflation and signal central banks commitment to maintaining financial s

154、tability.This often required central banks to maintain higher than necessary interest rates to ensure a strong exchange rate and secure international investors confidence in the economy.It also 16WORLD ECONOMIC SITUATION AND PROSPECTS AS OF MID-2023meant that actual output in the economy often remai

155、ned below potential output during periods of large capital inflows and both domestic investments and exports suffered setbacks.The prospect of QT is now posing an even greater challenge for the developing country central banks.With monetary tightening,the dollar has appreciated against most developi

156、ng countries currencies during the past year,making imports more expensive and further fuelling inflation.This has compelled many developing country central banks to pursue faster rate increases than in the developed economies(figure 13).Moreover,as developed country monetary authorities increased p

157、olicy rates and began to implement QT,many developing countries began to experience quick reversal of capital flows,higher borrowing costs and increasing rollover and debt sustainability risks.However,developing countries,especially many low-income countries,have not yet recovered from the pandemic.

158、Rapid interest rate hikes and tighter global liquidity conditions in tandem with rising pressures for fiscal consolidation to improve debt sustainability will further delay their recovery and push them towards a low growth path in the medium term,making it ever more difficult for them to accelerate

159、progress towards sustainable development.Figure 13Policy rate changes in selected regions and country groupingsSource:UN DESA,based on data from CEIC.Regional policy rate(median)in March 2023Regional policy rate(median),lowest level between January 2020 and March 2023Percentage2.50246810120246810123

160、.90.1Developedeconomies7.83.0Developingeconomies11.05.0Economiesin transition4.00.8South-EasternEurope5.5Asia9.37.0Africa11.06.3Commonwealthof IndependentStates and Georgia11.32.8Latin Americaand theCaribbean17REGIONAL ECONOMIC OUTLOOK Regional economic outlookDeveloped economiesUnited StatesThe eco

161、nomy of the United States is forecast to grow by 1.1percent in 2023,marking an upward revision of 0.7 percentage points from the forecast released in January 2023.This is largely due to better than expected household spending and economic resilience during the first half of 2023.Underneath the appar

162、ent resilience,there are significant fragilities.The recent banking sector turmoil,while quickly contained by regulators,has exposed underlying financial vulnerabilities as interest rates rise rapidly,and remains a source of concern.In the product and services market,supply has not kept up with stro

163、ng consumer demand,resulting in sustained upward price pressures and complicated monetary policy choices.High prices usually encourage more supply of goods and services,contributing to easing price pressures,but this has not been the case so far,partly reflecting labour market constraints.Furthermor

164、e,higher interest rates and tighter credit market conditions will continue to constrain supply of goods and services.A similar mismatch in the housing market has prevented adjustment in housing prices and sustained high household net worth,which,in turn,has supported strong household spending.High h

165、ousing prices and very low inventory should boost housing supply.But high interest rates translating to higher mortgage rates have impaired both housing affordability and investment in new construction.A correction of housing prices reducing household net worth and spending via the wealth effect wil

166、l remain critical in restoring equilibrium in the housing market.In the credit market too,credit demand especially demand for consumer credit remains strong despite sharp increases in interest rates.Restoring equilibrium in the credit market will require credit demand to fall amid tighter credit con

167、ditions,leading to reduced spending and investment.These adjustments in prices will weaken economic activities during the second half of the year and contribute to pushing the economy towards a contraction in late 2023 and early 2024.EuropeEuropes economies have proven more resilient than previously

168、 expected.While high energy costs,persistent inflation and aggressive monetary tightening have weighed heavily on economic growth,most countries have so far escaped recession and the short-term outlook has improved.In the European Union,GDP is projected to expand by 0.9percent in 2023(up from 0.2per

169、cent forecast in January)and 1.5percent in 2024.The recession in the United Kingdom will also likely be milder than previously predicted,with GDP growth projected 18WORLD ECONOMIC SITUATION AND PROSPECTS AS OF MID-2023at-0.1percent in 2023(up from-0.8percent forecast in January)and 1.1percent in 202

170、4.The broad-based upward revisions in growth reflect several positive developments in recent months.Europe averted gas shortages during the winter,with wholesale natural gas prices falling below their pre-war levels due to unusually warm weather,demand restraint and diversification of energy supply

171、sources.The re-opening of Chinas economy and further easing of supply bottlenecks have boosted manufacturing output,while service sector output has benefited from strong demand for leisure activities.Average annual inflation in the European Union is projected to decline from 8.8percent in 2022 to 6.

172、0percent in 2023 and 2.8percent in 2024;the pace of disinflation may be slower in East European countries.Despite economic slowdown,labour markets across Europe remain exceptionally strong.The unemployment rate in the European Union stood at a record low of 6percent in February 2023.The employment r

173、ate among persons aged 20-64 reached an all-time high of 74.9percent in the fourth quarter of 2022,2 percentage points higher than before the COVID-19 crisis and more than 8 percentage higher than a decade ago.The regions baseline outlook,however,faces significant downside risks.International energy

174、 markets remain highly vulnerable to a further deterioration in geopolitical conditions.At the same time,tighter financial conditions could expose vulnerabilities,especially in the regions commercial and residential real estate markets.Developed Asia and the PacificEconomic growth of developed Asia

175、and the Pacific countries is forecast to slow to 1.4percent in 2023 and 1.3percent in 2024.Significant monetary tightening in Australia and New Zealand is expected to weigh on domestic demand,while falling disposable income will slow household spending.In Japan,pent-up household spending after lifti

176、ng of COVID-19 restrictions appears to be dissipating,weakening near-term growth to 1.2percent in 2023(from 1.5percent projected earlier).The Republic of Koreas economy will face significant headwinds in 2023 amid cumulative transmission effects of monetary tightening and reduced fiscal support.The

177、region faces weakening external demand,although Chinas re-opening could alleviate some pressures.Risks to the outlook in developed Asia and the Pacific are largely tilted to the downside.The full impact of higher interest rates is yet to be felt,due to the lagged effects of monetary policy.Moreover,

178、although inflation may have peaked in Australia and New Zealand,wage increases could feed into headline inflation,forcing more interest rate hikes.In Japan,more persistent than expected inflation may prompt a shift in the expansionary monetary policy stance.Furthermore,the risk of a sharp housing ma

179、rket correction has been rising in Australia,the Republic of Korea and New Zealand.Economies in transitionThe war in Ukraine and the associated economic disruptions,including those due to sanctions against the Russian Federation,continue to influence economic prospects of the Commonwealth of Indepen

180、dent State(CIS)and Georgia.Following the officially reported contraction of 2.1percent in 2022,the Russian economy is projected to marginally shrink in 2023,before returning to a low medium-term growth path in 2024.Russian export revenues plummeted in the first quarter of 2023,with oil flows reorien

181、ted from Europe mostly to Asia.Consumer confidence remains low despite tight labour market conditions.Although fiscal support to the economy,including military spending,is expected to continue in 2023,stronger enforcement of restrictions on the import of sanctioned technologies through third countri

182、es may constrain productive investment.The economy of Ukraine lost a large share of its industrial capacity and energy infrastructure to the war and contracted by 29.1percent in 2022.Despite the external financial assistance,19REGIONAL ECONOMIC OUTLOOK including an IMF loan and budget support from t

183、he European Union and the United States,the economy is likely to stagnate in 2023.The longer-term outlook for Ukraine will depend on the duration and intensity of the war and its ability to finance reconstruction,with reconstruction cost estimates raised to$411 billion.29 Energy exporters of the reg

184、ion including Azerbaijan and Kazakhstan are set to benefit from the higher oil prices resulting from the OPEC+agreement.Following a contraction by 1.9percent in 2022,the aggregate GDP of the CIS and Georgia is expected to expand by only 0.6percent in 2023.Growth is forecast to accelerate to 2.2perce

185、nt in 2024.For the countries of South-Eastern Europe,amid a sluggish European Union economy,GDP growth is projected to slow from 3.2percent in 2022 to 2.0percent in 2023,with a rebound to 3.0percent forecast for 2024.Developing economiesAfricaAfricas growth is projected to decelerate slightly from 3

186、.5percent in 2022 to 3.4percent in 2023 before returning to 3.5percent in 2024.30 The latest forecasts reflect downward revisions of 0.4 percentage points for 2023 and 0.3 percentage points for 2024 from the forecasts released in January,accounting for weaker growth prospects in Egypt and South Afri

187、ca.Egypt is now projected to face more pronounced balance-of-payments constraints throughout 2023 despite recent monetary tightening measures and currency devaluations.The power crisis in South Africa,including daily rolling power cuts,is projected to hamper economic activities much longer than expe

188、cted.Several factors are influencing near-term growth prospects in Africa.First,as monetary stances 29 World Bank,Government of Ukraine,European Union,United Nations(2023).Ukraine Rapid Damage and Needs Assessment February 2022 February 2023.30 Africas average growth excludes Libya,which experiences

189、 large fluctuations in GDP due to geopolitical factors.31 World Food Programme(2023).Food Insecurity and Malnutrition in West and Central Africa at 10-Year High as Crisis Spreads to Coastal Countries.News Release.are projected to remain mostly tight,credit conditions will further tighten.The cost of

190、 external funding through international capital markets is expected to stay prohibitively high.For countries with substantial financing gaps and high external debt burdens,space for domestic demand expansion is very limited in 2023.Second,mining sector and mining-related investments will support gro

191、wth in several African economies.The mining sector was the main driver of recent growth,particularly when tourism and other services sectors growth plunged during the pandemic.The expected completion of new investments,such as the NigerBenin oil pipeline and a liquefied natural gas project offshore

192、of Mauritania and Senegal,improves near-term growth prospects of several African countries.Meanwhile,many countries in the region will face growing food insecurity.Despite declining international grain prices,a significant fraction of the population in Africa remains food insecure.In West and Centra

193、l Africa,the level of food insecurity and malnutrition reached a 10-year high.31East AsiaRecovery in East Asian developing economies is expected to continue but will likely lose some steam amid global monetary tightening and weakening external demand.In 2023,East Asias growth is forecast to moderate

194、ly improve to 4.7percent,compared to 3.2percent in 2022.The improvement mainly reflects Chinas recovery.The Chinese economy is predicted to grow by 5.3percent in 2023,up from 3percent in 2022.After lifting the COVID-19 related restrictions in late 2022,consumer spending and fixed asset investment qu

195、ickly recovered,thanks to pro-growth policy measures.Both manufacturing and services Purchasing Managers Indexes(PMIs)moved to the“expansionary zone”in early 2023.However,uncertainties persist in the property sector,which may negatively impact household 20WORLD ECONOMIC SITUATION AND PROSPECTS AS OF

196、 MID-2023spending and growth during the second half of 2023.Several export-driven East Asian economies have been hit by weakening external demand.Exports and industrial production in Malaysia,Singapore,Taiwan Province of China,Thailand and VietNam have slowed or contracted since late 2022.Although s

197、trong recovery in China could provide some impetus,especially for commodity-and tourism-dependent economies,it is unlikely to fully offset the sluggish demand in the developed economies.At the same time,policy rate hikes to curb inflationary pressures and maintain financial stability have weakened d

198、omestic demand in many East Asian economies.Sharp increases in public spending during the pandemic have constrained fiscal space,and limited the scope for further fiscal support in the near term.While the regions average inflation is expected to ease to 2.2percent in 2023 from 2.8percent in 2022,it

199、is predicted to remain elevated in Indonesia,the Philippines and Singapore,among others.Several economies in the region especially Fiji and Lao Peoples Democratic Republic32-have experienced a rapid increase in the debt-to-GDP ratio since the onset of the pandemic.Further tightening of global financ

200、ial conditions could push up their debt distress levels.Some East Asian economies face idiosyncratic downside risks,including civil conflict in Myanmar and natural disasters in the Pacific small island developing states(SIDS).Geopolitical tensions,weak external demand and tighter global financial co

201、nditions will negatively impact the regions near-term outlook.South AsiaSouth Asias economy is projected to grow by 4.7percent in 2023 and 5.8percent in 2024,a slight downward revision of 0.1 percentage 32 According to the IMFs World Economic Outlook database(April 2023 version),the debt-to-GDP rati

202、o rose from 49percent in 2019 to an estimated 92percent in 2022 in Fiji,and from 69percent in 2019 to an estimated 128percent in 2022 in Lao Peoples Democratic Republic.33 World Bank(2023).Food Security Update.April 6.Washington,DC:World Bank.points for both years from the forecasts in January.High

203、inflation,tighter financial conditions,weaker private consumption,and external imbalances will continue to impact growth in 2023.As the region is highly vulnerable to extreme climate conditions,potential droughts and floods also pose a significant risk to the economic outlook.Indias economy the larg

204、est in the region is expected to expand by 5.8percent in 2023 and 6.7percent in 2024(calendar year basis),supported by resilient domestic demand.However,higher interest rates and weaker external demand will continue to weigh on investment and exports in 2023.Regional consumer price inflation is proj

205、ected to average 11.0percent in 2023 and 9.4percent in 2024,slightly lower than the 12.9percent recorded in 2022.Inflation in India is expected to decelerate to 5.5percent in 2023 as global commodity prices moderate and slower currency depreciation reduces imported inflation.Inflation rates in Pakis

206、tan and Sri Lanka are expected to remain in double digits in the coming months owing to weakening local currencies and supply-side constraints.Domestic food inflation remains elevated due to country-specific factors,challenging food security across the region,particularly in Afghanistan,Bangladesh,a

207、nd Pakistan.33Central banks in the region continued their interest rates hikes in early 2023 to tackle inflation and stabilize exchange rates.However,the Reserve Bank of India kept the policy rate unchanged at 6.5percent in April 2023,after a cumulative increase of 250 basis points since May 2022.We

208、stern AsiaWestern Asias growth is projected to decelerate from 6.6percent in 2022 to 3.1percent in 2023 before increasing to 3.3percent in 2024.The projection has been revised down by 0.4 percentage points for 2023 and 0.1 percentage 21REGIONAL ECONOMIC OUTLOOK points for 2024 from the forecast rele

209、ased in January.The growth impacts of increased crude oil production and recovery of international tourism in 2022 have dissipated.Furthermore,the decision by the OPEC and other major oil producers to reduce crude oil production from May 2023 will weigh on real GDP growth in the Gulf Cooperation Cou

210、ncil(GCC)member countries.Monetary tightening measures by the central banks in the GCC countries,Israel and Jordan have weakened domestic demand growth.Tighter monetary stances and stabilizing global grain prices have also contributed to lower inflationary pressures.However,Lebanon,the Syrian Arab R

211、epublic,Trkiye,and Yemen facing severe balance-of-payments constraints have continued to experience high inflation due to weakening exchange rates.Fiscal stances have become more expansionary in the region,except in Jordan,Lebanon,the Syrian Arab Republic,and Yemen,where fiscal consolidation measure

212、s continue.In Trkiye and the Syrian Arab Republic,recovery efforts after the devastating earthquake in February 2023 have required additional fiscal measures,with international cooperation.The region faces the downside risks of unstable oil prices and uncertain geopolitical situations.Latin America

213、and the CaribbeanAfter a robust growth performance in 2022,the economic outlook in Latin America and the Caribbean is deteriorating sharply.Subdued global growth,still-elevated inflation,and 34 Regional inflation figures exclude Argentina and the Bolivarian Republic of Venezuela.structural vulnerabi

214、lities are adversely affecting the regions economic performance.Also,higher borrowing costs are impacting consumer spending and investment.Fiscal space remains constrained and unable to support economic activity in most countries.Regional GDP growth is projected to slow significantly from 3.8percent

215、 in 2022 to only 1.4percent in 2023,recovering moderately to 2.4percent in 2024.The slowdown in 2023 is broad-based across the region,particularly affecting Argentina,Brazil,Chile,and Colombia.After an expansion of 2.9percent in 2022,Brazils GDP is projected to expand by only 1percent in 2023.Region

216、al average inflation is forecast to decline from 9.3percent in 2022 to 6.7percent in 2023,but this masks significant differences across countries.34 Headline inflation is softening visibly in Brazil,Costa Rica and Uruguay,among others.As a result,the central banks that hiked interest rates early and

217、 aggressively may pivot and recalibrate their monetary stances in the second half of 2023.In other countries,however,price pressures remain elevated and central banks will likely continue to raise interest rates in the near term.Meanwhile,the labour market prospects are challenging,as slower growth

218、hampers job creation and inflation continues to impact real incomes.Consequently,socioeconomic conditions in the region are unlikely to improve in the near term.The pandemic crisis and the war in Ukraine left many economies grappling with higher levels of poverty,informality,and food insecurity.A move towards fiscal consolidation or prolonged monetary tightening could further worsen regional economic prospects.For more informationwww.un.org/en/desa