Davos 2023: Global recession in 2023 seen as likely in WEF survey

Climate activists block the airport near St Gallen, Altenrhein, Switzerland ahead of the World Economic Forum in Davos.

Two-thirds of private and public sector chief economists surveyed by the World Economic Forum (WEF) expect a global recession in 2023, the Davos-organiser said as business and government leaders gathered for its annual meeting.

Some 18% considered a world recession "extremely likely" — more than twice as many as in the previous survey conducted in September 2022. Only one-third of respondents to the survey viewed it as unlikely this year.

"The current high inflation, low growth, high debt, and high fragmentation environment reduces incentives for the investments needed to get back to growth and raise living standards for the world's most vulnerable," WEF Managing Director Saadia Zahidi said in a statement accompanying the survey results.

The organisation's survey was based on 22 responses from a group of senior economists drawn from international agencies including the International Monetary Fund, investment banks, multinationals, and reinsurance groups.

Growth forecasts

The survey comes after the World Bank last week slashed its 2023 growth forecasts to levels close to recession for many countries as the impact of central bank rate hikes intensifies, Russia's war in Ukraine continues and the world's major economic engines sputter.

The annual global think-in runs until Friday. The Minister for Finance Michael McGrath will attend the summit tomorrow following this morning's meeting of EU finance ministers in Brussels. In Davos, McGrath will participate in a panel discussion titled Jobs Consortium: Towards a New Vision for the Future of Work. The Minister will also host a dinner with IDA client companies who are key investors in Ireland.

Manchester United

On the main high street in Davos, where the ski resort's shops have been temporarily converted into slick spaces by tech companies, banks, and governments to host events, a luxury lounge from Machester United stood out. However, the premier league club insisted its lounge was to entertain clients and partners rather than to attract buyers for the football club.

United said in November it was looking at options to either get new investment or explore a potential sale, 17 years after the Glazer family bought the 20-times top-flight champions.

Reuters