A global recession is highly likely to take place in 2023, and the situation is likely to remain the same until 2025. This was predicted by the Centre for Economics and Business Research (CEBR). This will be the second major global recession after the one that occurred in 2008 amid the great depression.
According to the IMF Reports, it is said that more than one-third of global economies will shrink. The main reason why the growth of the whole world has been decreasing is because the world’s big economies like the US, Europe, and China are facing a major fall off in their growth. IMF global growth statistics slows down to 3.2% in 2022 and 2.7% in 2023 from 6.0% in 2021. This has been the weakest report since 2021 and it is about to get worse for the next 2-3 years down the lane.
The World Bank has reported that the estimates for the growth of the global economy are 1.7% in 2023 and 2.7% in 2024; they are said to be predicted and can change according to the circumstances. According to CEBR, there is a 25% possibility in 2023 that the global economy will increase by no less than 2%, which is known as the global recession. But as reports say that 2023 recession is much slower than the one which occurred in 2008 and 2020.
The report of economic outlook 2023 stated that. “This wider economic impact channels through trade, investment, labour and technology flows, creating myriad challenges and opportunities for business. At the other end of the spectrum, the fall of the cryptocurrency sector is expected to have relatively little spillover into wider financial markets and the majority of chief economists do not expect further economic disruption from COVID-19.”
US and Europe are the ones facing a major crisis due to this recession, as employment in both places has fallen drastically, which will affect not only the citizens over there but also international students and people from other countries who have gone to work over there.
Recently in the US, a huge number of employees at big IT companies like Google, Amazon, and Microsoft were laid off. At the end of 2022, it was seen that only 2% of international graduates in the UK had secured a job after the completion of their graduation, which was eventually the start of the global recession.
Even though China is the second largest economy, its economy, housing market, and functionalities are in crisis, which has eventually affected the growth of the country’s economy. Even China become the second in position when it comes to population and India took the first place.
The rates and prices of everything are increasing all over the globe by 5% to 13%. Prices of food, universities, school, colleges, clothes, housing, lands, imports and exports are going up by 10%. This will definitely affect the low-income countries more than the high-income countries.
But this global recession has affected and is going to affect India as well. Because the US is one of the superpowers and it is heavily affected by this recession, the repercussions will automatically be seen worldwide. Also, India is one of the great exporters to the US and has many business agreements with them, so ultimately, a drop in the US GDP and economy is the worst news for India. Though it is said by CEBR that India’s economy will reach $10 trillion by 2035 and rank third globally by 2032,
The world will take, say, about 3 to 5 years to come out of this recession completely as manifested, but economies will recover just like they did in 2008.