In its latest report, the Organization for Economic Cooperation and Development has estimated that the Russian invasion of Ukraine could reduce global GDP growth by 1%, Reuters reports.
On top of that, it could add another 2.5% to rising global inflation rates.
To mitigate the impact, the OECD has called for an increase in targeted government spending. The Organization believes that a targeted increase in public spending – on the order of 0.5% of GDP – by OECD countries could halve the economic consequences of the war without causing a hike in inflation.
Other forecasts include the negative impact of the war on the Eurozone economy, which could decline by up to 1.4% due to Europe's high dependence on Russian energy. On the other hand, for the United States, the fall may be smaller, at around 0.9%.
The OECD also emphasized the outsized impact of Ukraine and Russia on the energy and commodity markets, since both countries are large producers of raw materials that are used in many industries: from the production of catalytic converters for cars, to fertilizers.
Earlier, the UN expressed fears that Russia's invasion of Ukraine could cause a global surge in malnutrition and hunger.