Jakarta, CNN Indonesia –
Minister of Finance Sri Muliani foresee economy the world will fall into the abyss recession next year. Indonesia is no exception.
Previously, citing the AFP, the World Bank (World Bank) had projected a number of countries into recession into 2023 due to rising central bank interest rates in a number of countries.
According to Sri Mulyani, this step has been taken by a number of countries to reduce the surge in inflation. Ani, as it is commonly called, assures that politics will hamper the pace of economic growth, making it more difficult to avoid the threat of a recession.
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“The rise in interest rates is pretty extreme together, so the world is sure to go into recession in 2023,” Ani said in a press conference on Monday (9/26).
In the Global Economic Prospect June 2022 (GEP) report, the World Bank explained that high inflationary pressure in many countries was not in line with economic growth.
A number of developed countries, such as the United States, Europe and Japan, are expected to be dragged into a recession due to rising inflation.
The following countries are at risk of entering a recession:
1. United States of America (USA)
US economic growth contracted by 0.6% in the second quarter of 2022, after minus 1.6% in the first quarter of 2022.
Although it has contracted for two consecutive quarters, the US economy is not yet in a recession. The announcement of an economic recession was made by the Business Cycle Dating Committee, a body of eight economists selected by the National Bureau of Economic Research, a non-profit organization.
So far, they are still reluctant to use the word recession. On the other hand, the Fed has dismissed concerns about a recession. The US central bank insists that the US job market is still strong with evidence of 315,000 new workers in August 2022.
“A strong US labor market gives us the flexibility to be aggressive in our fight against inflation,” the Fed wrote.
2. Europe
The euro has fallen to its weakest level against the dollar since late 2002 to make European countries fear a recession. Rising natural gas prices have also triggered recession fears.
The data showed a sharp slowdown in business growth in June. Not only that, the statement shows a seasonally adjusted May 2022 trade deficit of 1 billion euros in Germany, against expectations of a surplus.
The UK economy is also showing signs of slowing due to high inflation. The UK central bank’s benchmark interest rate even increased by 200 basis points in 2022.
“The economy is starting to look like it is slowly stalling,” said Chris Williamson, chief business economist at S&P Global Market Intelligence.
3. China
According to a World Bank report on Tuesday (27/9), China, which accounts for 86% of the regional economic output of 23 countries, is expected to grow 2.8% this year. This figure is a significant drop from the previous 5.0 percent estimate.
The Chinese economy has in fact weakened in recent months following the blockade policy imposed in the country of the bamboo curtain. This also disrupted the industrial sector, domestic sales and export activities.
“We expect real GDP growth to slow sharply to 4.3% in 2022 to 0.8 points, which is lower than expected in the December Chinese economic update,” the IMF wrote in its June 2022 Chinese economic report. .
Indonesia is no exception
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