ASIATODAY.ID, JAKARTA – The World Bank in the June 2024 edition of its Global Economic Prospects report explained that global economic risks still tend to be negative, although there is the possibility of some positive surprises.
In a report released Wednesday, June 12 2024, the World Bank said rising geopolitical tensions could cause commodity prices to fluctuate, while further trade fragmentation risks causing additional disruption to trading networks. Then, the World Bank also reminded that trade policy uncertainty had reached a very high level compared to previous years. This has been marked by elections around the world since 2000. Continuous inflation can also cause delays in monetary easing. High interest rates will also dampen global activity.
Several large economies are also at risk of growing more slowly than expected due to various domestic challenges. Additional natural disasters related to climate change could also hinder economic activity.
“On the plus side, global inflation may moderate more quickly than assumed in the baseline, allowing for quicker monetary policy easing. “Apart from that, growth in the United States could be stronger than expected,” wrote the June 2024 edition of the Global Economic Prospects report, quoted on Friday, June 14 2024.
Based on this background, the World Bank then provided a number of suggestions at both the global and national levels. At the global level, according to him, it is necessary to prioritize maintaining trade, encouraging the green and digital transition, providing debt relief and increasing food security. Then, at the national level, persistent inflation risks underscore the need for Emerging Markets and Developing Economies (EMDE) monetary policy to remain focused on price stability.
High debt and rising debt servicing costs require policymakers to look for ways to increase sustainable investment, while ensuring fiscal sustainability. Then, to achieve development goals and support long-term growth, the World Bank stated the need for structural policies.
According to the World Bank, this needs to be done to increase productivity growth, efficiency of public investment, build human resources, and close the gender gap in the labor market. (ATN)
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