The IMF expects global growth to decelerate from 5.9% in 2021 to 4.4% respectively in 2022. Advanced economies are projected to return to pre-pandemic output levels by 2023. For most emerging markets and developing economies the path to recovery is projected to take longer. By 2023, per capita incomes are expected to remain below 2019 levels for about 40% of these markets. This is particularly true for lower income countries (LICs) and countries in fragile and conflict-affected situations.
High inflation due to the resurgence of the pandemic, higher commodity prices, and continued supply chain disruptions could last longer than anticipated. Historically high government debt burden, deteriorating fiscal positions, an anticipated tightening of US monetary policy and adverse climate events put emerging markets and developing economies in a vulnerable position. Internationally, there are concerns that the situation in the Ukraine will further escalate. The IMF predicts that the imposed sanctions on Russia will have a significant impact on the global economy and financial markets that will spill over to other countries. This will further add to existing price inflation. Social tensions and political unrest may increase as a result of rising inequality.