OECD cuts global economic outlook on Ukraine war

London, June 8

Russia’s war in Ukraine and the energy and food crises it worsened will severely drag down global economic growth and push up inflation this year, the Organisation for Economic Cooperation and Development (OECD) said on Wednesday.

China’s “zero-Covid” policies that have scrambled manufacturing supply chains also are weighing on a world economy that was just starting to rebound from the Covid pandemic, the Paris-based OECD said, becoming the latest institution to slash its growth forecast and underscoring the dimming economic outlook.

The OECD, a club of largely wealthy nations, expects the global economy to expand 3% in 2022, down from the 4.5% that it predicted in December.

Inflation is forecast at nearly 9% for the OECD’s 38-member countries, which include the US, UK and many European nations, nearly double the previous estimate.

The World Bank, the United Nations, and the IMF have made similar downgrades to their economic forecasts recently.

“Russia’s war is indeed imposing a heavy price on the global economy,” OECD Secretary-General Mathias Cormann said in Paris.

The organisation released its forecast as it gears up for a two-day annual meeting starting Thursday, attended by government ministers and featuring video remarks by Ukrainian president Volodymyr Zelenskyy. — AP