​By Alexander Lee  
 

Screenshot from Sky News World Bank (WB)
 
President has expressed concern that this year's global economic slowdown could last for a long period. On January 22, World Bank President David Malpass said in an interview with Sky News, 'This slow growth period in the world could continue until 2023-24, and that's concerning.' Malpass said that ongoing inflation and a lack of new investments are obstacles. He mentioned, 'It's hard to see a strong recovery in one or two years from now.'
On January 10, the World Bank announced its global economic outlook, predicting a world economic growth rate of 1.7% this year. This is 1.3 percentage points lower than the 3.0% predicted in their June report last year.
Malpass emphasized that governments around the world should strive for efficiency in subsidy expenditures during low-growth periods. In particular, when governments provide financial relief to their citizens to cope with energy price shocks, he urged that government spending should not be unlimited. Malpass stated, 'When governments want to appear political and attractive by paying subsidies to citizens, they need to make sure that it is limited in time and targeted.' For example, instead of benefiting everyone in the future, it should be aimed at the narrowest target group that could be harmed by high prices currently, for about six months.
After food prices soared last year due to the war in Ukraine, the World Bank expressed particular concern for underdeveloped countries. In addition, Malpass anticipated that it would be difficult for developing countries affected by China, the world's second-largest economy, to show strong recovery amid expected low growth in China. Malpass said, 'Underdeveloped countries are facing significant challenges. Especially when they have excessively utilized debt during low-interest situations, they are in crisis during high-interest phases,' and added, 'We are providing targets for underdeveloped countries to achieve better growth, even if they can't achieve it right away.'
 
​By Reporter Alexander Lee alexanderlee_24@newsyn.co.kr