NEW DELHI: The G20, meeting in the Indian capital of New Delhi, issued a warning on Saturday regarding significant headwinds and the persistent threat of “cascading crises” that are impacting the global economy. The statement also suggested that further challenges could be on the horizon.
The Group of 20 leading economies acknowledged the existence of cascading crises that have presented obstacles to long-term economic growth. They expressed concern about the tightening of global financial conditions, which could exacerbate debt vulnerabilities, ongoing inflation, and geopolitical tensions. The statement emphasized that the risks to the global economy remain tilted toward the downside.
Many countries are still in the process of recovering from the impact of the coronavirus pandemic and grappling with the dramatic surges in commodity prices triggered by Russia’s invasion of Ukraine. Additionally, climate change is disproportionately affecting some of the world’s poorest nations, which are often the least equipped to handle such challenges.
G20 Cautions on Uneven Global Economic Recovery
The G20 statement underscored that global economic growth currently falls below its long-term average and remains uneven. It acknowledged a high degree of uncertainty surrounding the economic outlook.
US Treasury Secretary Janet Yellen, speaking before the G20 summit, noted her awareness of the risks to global growth but expressed surprise at the strength and resilience demonstrated by the global economy. She acknowledged that while certain countries have been affected, overall, the global economy has proven to be resilient. Yellen identified Russia’s war on Ukraine as a significant negative influence on the global economic landscape.
