The industrialized nations organization OECD has corrected its forecast for the growth of the global economy significantly downwards because of the war in Ukraine. The Organization for Economic Cooperation and Development (OECD) announced on Wednesday in Paris that growth of only 3 percent is now expected for the current year instead of the previous 4.5 percent. Growth of 2.8 percent is expected for the coming year instead of the previously forecast 3.2 percent. Inflation will also be higher as a result of the war and last longer than previously assumed, said OECD Secretary General Mathias Cormann.
For Germany, the OECD predicts economic growth of 1.9 percent for 2022 and 1.7 percent for 2023. The war and oil embargo against Russia hampered the recovery. The increase in inflation is weakening purchasing power, which is dampening the revival in private consumption. The increased uncertainty, the sharp rise in energy prices and new material shortages impacted a number of sectors, as well as private investment and exports. The OECD advises that subsidy programs to cushion rising energy and food prices must be targeted precisely at needy households and companies. (dpa)
