Ajay Banga, President of the World Bank, addressed the World Economic Forum, stressing the critical role of economic growth in shaping the global landscape.
Banga asserted that sustained growth is indispensable for generating employment, fostering prosperity, and maintaining peace.
During his keynote speech at the WEF24 session, Banga provided a sobering outlook, stating, " The reality is we are headed for the first half of the decade to have the lowest growth rate in 30 years. Without growth, you don't have jobs, you don't have prosperity, and very often, without growth, you don't have peace. So I think growth is at the core of our challenges, both in the near and medium term." Banga highlighted the multifaceted challenges facing the global economy in the near and medium term. One prominent concern he pointed out is the escalating debt in emerging economies, encompassing both foreign and domestic debt.
"As we think out of the room, there is a challenge that adds room to it; there is debt in the emerging economy, which deeply concerns all of us. It's not just foreign debt; it's also domestic Debt, which they have taken on at a low interest rate. There are situational geopolitical challenges, there is trade tensions and I think one should not discount: If China's economy slows further, what does that do to our global economic circumstances? said Banga.
He acknowledged that these worrisome factors coexist with positive developments, noting that the world economy performed better than anticipated in the previous year.
"So there are a few things that are worrisome and then there is, of course, the positive, which is that we ended up last year doing better than everybody thought we would as a world economy. The second big piece of red light to bring out is the thought that you can solve for poverty and prosperity without caring not just about growth but also about climate, pandemics, healthcare, fragility, conflicts and violence," Banga asserted.
In his address, Banga emphasised the need for a holistic approach to address the intertwined challenges facing humanity.
"I think that we should recognise that we are dealing with intertwine challenges; they may not make our lives simpler but that's tough luck. we are in this world; that is what we have to deal with and right now, these intertwine challenges require a unified way of thinking, which is our biggest challenge" Banga added.
Ajay Banga's call for a unified way of thinking to confront these complex challenges resonate as a call to action, urging global leaders to navigate the intricate web of challenges with a comprehensive and unified approach.