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Russian foreign minister says new phase of Ukraine operation begins


Soldiers of the Ukrainian Military Forces move to their location in the Luhansk region of Ukraine on March 8.
Servicemen of the Ukrainian Military Forces move to their positions in the Luhansk region of Ukraine on March 8. (Anatolii Stepanov/AFP/Getty Images)

The International Monetary Fund has cut expectations for global economic growth over the next two years because of Russia’s invasion of Ukraine, comparing the effects from the conflict to an “earthquake”.

“The economic impacts of war are widespread and far-reaching,” the organization said in its latest outlook, published Tuesday.

The IMF now expects the world economy to grow 3.6% in both 2022 and 2023, a sharp drop from 6.1% growth in 2021. The new projections reflect contractions, respectively. are 0.8 and 0.2 percentage points from the January forecast.

The prospect suggests that the war is still confined to Ukraine, that further sanctions against Russia are not targeted at the country’s huge energy sector, and that the effects of the pandemic continue to fade.

The IMF said the conflict would hit Ukraine and Russia the hardest. The IMF forecasts that Ukraine’s economy will shrink 35% this year, while Western sanctions against Russia are poised to cause the country’s economy to shrink by 8.5%. But since the war has sent energy and other commodity prices skyrocketing, exacerbating supply chain problems and feeding more persistent inflation expectations, its effects will be palpable. almost everywhere.

“War will severely impede the global recovery, slow growth and further increase inflation,” the IMF said in its report, noting that The world economy has yet to fully recover from the coronavirus pandemic when Russia invaded Ukraine in late February.

In Europe, which relies heavily on Russia to meet its energy needs, growth is now expected to slow to 2.8% in 2022, down 1.1 percentage points from January.

The United States is relatively insulated. However, weakness among trading partners, as well as the Federal Reserve’s plan to quickly withdraw pandemic support for the economy and raise interest rates, are weighing on the outlook. . The IMF forecasts US growth of 3.7% in 2022 and 2.3% in 2023, down 0.3 percentage points since its last forecast.

While the report observes that the “global economic outlook has deteriorated significantly” since the start of the year, it does not predict a recession, which the IMF usually calls when growth falls to 2.5% or low. than.

But the IMF also noted that uncertainty was “out of the normal range” around its forecasts because of the unprecedented nature of the shock. And the risks of an even greater decline, combined with persistently high inflation, are growing.



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