Fasten your seatbelt. The recent IMF growth projections are hair-raising, although a solution to the conflict between Russia and Ukraine would change everything. On the contrary, if the conflict worsens, the crisis could be worse than that of 2008-2009 and longer.
The growth of the world economy will go from 6% in 2021 to 3.2% in 2022 and 2.7% in 2023. For the United States the projections are from 5.7% in 2021 to 1.6% in 2022 and 1% for 2023 .
For the Euro zone, growth in 2021 was 5.2%, projecting 3.1% for 2022 and 0.5% for 2023. The United Kingdom would be even worse. China would fall from 8.1% in 2021 to 3.2% in 2022 and 4.4% in 2023.
Japan will grow by 1.7% between 2021-2023. Russia, from a growth of 4.7% in 2021, would go into negative territory in 2022 and 2023 with -3.4% and -2.3% respectively.
Latin America and the Caribbean, after growing 6.9% in 2021, will fall to 3.5% in 2022 and 1.7% in 2023.
The world is in turmoil. From England already in recession, with inflation of 11.01% and a pound sterling in free fall, Europe with inflation of 10.6%, without enough energy for the winter and at prices still unattainable, passing through Russia with negative growth due to sanctions and China collapsing due to the zero COVID policy, nothing good can be expected for 2023.
The United States, with enough gas and oil, is bleeding its European allies dry with a strong dollar, although it will also go into recession next year as the Fed will continue raising rates to bring down inflation that is too high (7.7%). The same will do the other central banks.
To make matters worse, Russia will turn off the oil taps to Europe by setting a price cap of $60 a barrel.
First victims?
Mass layoffs and increased poverty with higher deficits and debt.
The Dominican Republic, growing 4% (more than doubling the average for Latin America and the Caribbean), will have great challenges ahead.
Interest rates will continue to rise, inflation will drop, there will be pressure for salary increases, and greater austerity in spending, affecting employment. But opportunities always exist if we manage to maintain 4 things: citizen security, stability, transparency and legal certainty, attracting new investments and millions of tourists fleeing the cold.