UN Secretary-General Antonio Guterres describes the “perfect storm” plaguing the global economy and shares what the UN is doing to help in Davos in 2023.
The Secretary-General of the United Nations, Antonio Guterres, gave a profound view on the global economy at Davos 2023, warning that the world is facing the eye of a Category 5 economic hurricane.
“We are looking at the eye of a storm of Level 5. Our world is suffering from a complete storm on many fronts,” said Guterres at the World Economic Forum on Wednesday. “Start in the short term, the global economic crisis. The outlook, as we all know, is dark. Many parts of the world are facing economic recession and the whole world is facing a recession. And we are seeing deep inequality and the rapid cost of living. A problem that affects women and girls the most. The disruption of the supply chain and the decline energy, inflation.”
Guterres further expressed his fears about the “perfect storm” hitting the world on “Mornings with Maria” on Wednesday.
“It worries me that we have a combination of things that are interconnected and have negative interactions,” he said.
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United Nations Secretary-General Antonio Guterres said he was worried about the “perfect storm” hitting the world economy “in the morning with Maria.” (AP Photo/Mary Altaffer, File/AP newsroom)
The war in Ukraine, rising food and energy prices, climate change and increasing wealth inequality were some of the things that Guterres feared would “create a situation” that gives “a clear picture of a recession.”
In addition, Guterres referred to economies beyond the US, Europe and Asia bearing the brunt of the economic crisis.
“Interest rates are rising excessively in the south of the world. Countries are close to default. They have no resources because they could not print money like the US, as Europe did during the COVID,” said Guterres. “They don’t have access to concessional financing because most of them are middle-income countries, look at small developing countries, Caribbean islands, they lived on tourism. , they didn’t have debt to live, they didn’t have concessional money. So we have it in the Global South, a situation where people are suffering and we have to understand that.”
Guterres called for increased “internationalization mechanisms” in response to widespread economic distress.
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When asked what the UN can do to fight the economic hurricane, Guterres put forward a proposal from the United Nations that emphasizes the promotion of the world to solve the economic problems and resources to overcome the ocean “just a transition” from fossil control to clean energy.
“Our proposal is to have a global stimulus, a global stimulus that is able to fix the economy, and a global stimulus that is able to face the challenges of the poorest in the world, and at the same time generate the necessary funds for a just change in relation to climate change,” Guterres told host Maria Bartiromo.
“We need to move from fossil fuel management to combustibles. But we need to do it the right way,” he added. “We are only taking into account the people who will be negatively affected in the areas that live in fossil fuel predominance. We are looking at training, we are looking at new jobs, the areas need to be invested. This change needs to be well managed, not like the rust belt in the past where the change from big business in the United States, Europe , in some parts of the world it didn’t come together properly.”
Guterres also explained that the UN wants “higher commitments” from China to move quickly in reducing its domestic emissions to help the global effort to fight climate change. He noted, however, that technological assistance may be needed to help China achieve faster emissions reductions.
“We have to make sure that China reduces its emissions. This is important for the world,” Guterres said. “But China needs technical support, I won’t talk about money, but technical support to be able to do it because they have a very old industry in many places and more reliance on coal.”
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Given the global economic outlook and climate fears, Guterres added that it was “very important” to have “serious” negotiations between the West and China.
“With the weather, with the decline of the world economy, and the surprising situation of the developing world, and the risks of the return of the epidemic, I think it is very important to have a difficult negotiation on the table where everything is clearly laid out. between China and the Western world.
