Developing countries will fall further behind the rich world as they struggle to recover from the economic impact of the pandemic owing to the spread of coronavirus variants and their limited capacity for stimulus efforts, the World Bank has warned.
In new economic forecasts published on Tuesday the Washington-based institution said it expected the global economy to experience a two-speed recovery in 2022 that would fuel widening inequality. While output in rich countries will return to pre-pandemic levels by 2023, developing countries will still be an average of 4 per cent below their pre-pandemic level.
The feeble rebound from the impact of coronavirus will be especially severe among the most vulnerable countries, the bank said; by next year, output among fragile, conflict-affected and small island states will still be 7.5 to 8.5 per cent below its pre-pandemic level.