The World Bank has warned that countries around the world are facing recession as the Ukraine war strains economies already strained by the Covid pandemic.
Less developed countries in Europe and East Asia are facing a “major recession,” according to the report.
The risk of high inflation and low growth, or “stagflation,” has also increased, according to World Bank President David Malpass.
Globally, energy and food prices have been rising.
“The war in Ukraine, lockdowns in China, supply-chain disruptions, and the risk of stagflation are hammering growth. For many countries, recession will be hard to avoid,” Mr Malpass said.
He also warned in the World Bank’s Global Economic Prospects report for June that the danger of stagflation was “considerable”.
“Subdued growth will likely persist throughout the decade because of weak investment in most of the world. With inflation now running at multi-decade highs in many countries and supply expected to grow slowly, there is a risk that inflation will remain higher for longer.”
Also on Tuesday, the World Bank approved an additional $1.49 billion (£1.2 billion) in funding for Ukraine, which it stated would be used to “pay for wages for government and social workers.”
The new funding is part of a $4 billion support package for the country, which includes healthcare, education, and sanitation.