Global Economic Developments and Expectations
The year 2022 was characterized by a slowdown in the global economic
recovery following a rapid rebound in 2021. The primary causes of the slowdown
were rising geopolitical risks (particularly the Russia-Ukraine war), rising
inflationary pressures from rising energy and food prices, monetary tightening
led by the US Federal Reserve (FED), supply constraints, and China’s
zero-tolerance policies against the pandemic.
2022. This volatility illustrates the complexities and uncertainties in
the global economic environment, highlighting the continued impact of
existing pandemic-related challenges in 2022 and the continued impact
of new geopolitical risks.Global trade volume followed a similar pattern
and increased by 4% in 2022, down from the 10.6% increase recorded in
the previous year. This trade slowdown mirrors the global economic
slowdown and emphasizes the impact of ongoing supply chain disruptions
and geopolitical tensions. .
Inflation emerged as a major issue in 2022, fueled primarily by the
increase in food and energy prices. According to the World Bank, the
year-on-year global inflation rate reached 7.6%.
This is a significant increase compared to the 4.7% rate in 2021,
prompting central banks of developed countries to implement tighter
monetary policies. The global public debt stock/GDP ratio, which
reached 107% at the end of 2020 due to increased public spending during
the pandemic, fell partially to 99% by the end of the third quarter of
2022. While this indicates some fiscal recovery, the economic outlook
as a whole still faces challenges.
Looking ahead, the World Bank expects global growth to go down to 1.7%
in 2023, led by a slowdown in the US, European Union, and Chinese
economies, due to tighter monetary policies, deteriorating financial
conditions, and the effects of the ongoing Russia-Ukraine war.
Fortunately, what lies beyond the horizon is not completely grim.
Global inflation is expected to remain high in 2023, but it will
gradually decline. This shift will provide some relief to economies
struggling with cost pressures and offer a potential path to stability.
| Key Indicators of the Global Economy | 2021 | 2022 | 2023 |
|---|---|---|---|
| Global Growth Rate (%) | 5,9 | 2,9 | 1,7 |
| Developed Countries Growth Rate (%) | 5,3 | 2,5 | 0,5 |
| Developing Countries Growth Rate (%) | 6,7 | 3,4 | 3,4 |
| Global Trade Volumes (change in %) | 10,6 | 4,0 | 1,6 |
| Oil Prices (USD, Barrel) | 70,4 | 100 | 88 |
| Global Inflation (%) | 4,7 | 7,6 | 5,2 |
Source: World Bank Global Economic Prospects Report, January 2023
The Development and Investment Bank of Türkiye (TKYB) maintains its agility and adaptability through a strategic approach that acknowledges the multifaceted nature of global challenges. Despite the ongoing uncertainties in the global economic landscape, the Bank is strengthening its commitment to sustainable growth and development with solid foundations. The Bank’s vision is motivated by the promotion of sustainable investments that contribute to national and international prosperity. The Bank closely monitors global economic developments and forecasts, incorporating pertinent information into its strategic decision-making. Given the uncertainties and fluctuations in the global economy, the Bank moves forward with determination and caution, aiming for optimal outcomes for all stakeholders.