What is a recession? 5 economic stories to read this week

Jul 22, 2022

Russian sanctions, carbon budgets and recessions - here are the latest economic stories. Image: Unsplash/AbsolutVision

Tom Crowfoot

Writer, Forum Agenda

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This weekly round-up brings you some key economic stories from the past seven days.
Top economics stories: What is a recession?; Russia's resilience to sanctions; The economic and political crisis in Sri Lanka; Economic priorities for the G20; Carbon budgets explained.

1. What is a recession?

With slowing growth, rising inflation and a 'global economic outlook that has darkened significantly', according to the IMF, the word 'recession' is on the lips of many. But, what is a recession?

The National Bureau of Economic Research (NBER) defines the event as “a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in production, employment, real income and other indicators. A recession begins when the economy reaches a peak of activity and ends when the economy reaches its trough.”

A chart showing the annual GDP growth projections for 2022 around the world.

Global GDP has declined this year following the war in Ukraine. Image: OECD

Discover more about how recessions are created and how they end.

Discover

What is the World Economic Forum doing to help companies reduce carbon emissions?

Corporate leaders from the mining, metals and manufacturing industries are changing their approach to integrating climate considerations into complex supply chains.

The Forum’s Mining and Metals Blockchain Initiative, created to accelerate an industry solution for supply chain visibility and environmental, social and corporate governance (ESG) requirements, has released a unique proof of concept to trace emissions across the value chain using distributed ledger technology.

Developed in collaboration with industry experts, it not only tests the technological feasibility of the solution, but also explores the complexities of the supply chain dynamics and sets requirements for future data utilization.

In doing so, the proof of concept responds to demands from stakeholders to create “mine-to-market” visibility and accountability.

The World Economic Forum’s Mining and Metals community is a high-level group of peers dedicated to ensuring the long-term sustainability of their industry and society. Read more about their work, and how to join, via our Impact Story.

2. How resilient is Russia's economy against sanctions?

Five months on from being hit by harsh sanctions, the ruble appears to be in a better state than many people expected. A higher price of oil has helped the nation's economy, as well as some emergency measures. But can it last?

A graph showing how the Russian ruble compared to the US dollar from 1 Feb to 14 July 2022

After an initial hit in March, the Russian ruble has consistently risen in value. Image: Wall Street Journal

Learn more about how the Russian economy is faring and the actions the rest of the world is taking.

3. The economic crisis in Sri Lanka visualized

Sri Lanka is currently facing an economic and political crisis, defaulting on its debt payments and near empty foreign currency reserves. This economic turmoil has led to mass protests and violence across the nation. So what led to this?

A timeline of the events leading up to Sri Lanka's current economic and political crisis.

Sri Lanka is $51bn in debt to foreign entities. Here's how it happened Image: Visual Capitalist

Find out what the economic crisis means for Sri Lanka.

4. Economic priorities for the G20

Ahead of last week's G20 meeting Kristalina Georgieva, the Managing Director of the International Monetary Fund (IMF), looked at the challenges facing the global economy and outlined three economic recommendations.

1. Countries must do everything in their power to tackle high inflation

2. Fiscal policy must help - not hinder - central bank efforts to bring down inflation.

3. The G20 must lead a fresh impetus for global cooperation.

Read more about the G20's economic recommendations.

Have you read?

5. What are carbon budgets and how can they help us reach net zero?

Carbon budgets are not dissimilar to everyday household spending budgets. They measure CO2 emissions across industries, homes and countries in order to calculate how much emissions should be cut by to reach net zero.

A visualization explaining what a carbon budget is.

Carbon budgets measure how much CO2 is produced and calculate by how much emissions must be cut in the future. Image: Carbon Tracker

By calculating these carbon budgets, governments can work towards meeting climate commitments.

Discover more about carbon budgets and how countries are using them.

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The views expressed in this article are those of the author alone and not the World Economic Forum.