The World Bank has warned of a "considerable" risk of stagflation, with subdued growth likely to persist "throughout the decade".
Writing in its latest Global Economic Prospects report, World Bank president David Malpass said global growth could fall to 2.1% in 2022 and 1.5% in 2023, if downside risks materialise.
He added the combination of the war in Ukraine, Chinese lockdowns and supply chain disruptions make recession "hard to avoid" for many countries.
"Changes in fiscal, monetary, climate and debt policy are needed to counter capital misallocation and inequality," Malpass said.
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The report detailed that the world has found itself at a juncture that resembles the 1970s in three key aspects: persistent supply-side disturbances fuelling inflation, preceded by a protracted period of highly accommodative monetary policy in major advanced economies; prospects for weakening growth; and vulnerabilities that emerging market and developing economies face with respect to the monetary policy tightening that will be needed to rein in inflation.
However, the report added that the current situation also differed from the 1970s in a variety of ways, including a strong dollar, smaller commodity percentage increases and generally strong balance sheets.
Inflation is likely to remain above targets in many economies, the report stated, warning that if this remains elevated, there is a risk of repeating the debt crises of the 1980s.
Ayhan Kose, director of the World Bank prospects group, explained that alongside ensuring fiscal sustainability, developing economies will "need to mitigate the effects of today's overlapping crises on their poorest citizens".
"Communicating monetary policy decisions clearly, leveraging credible monetary policy frameworks, and protecting central bank independence can effectively anchor inflation expectations and reduce the amount of policy tightening required to achieve the desired effects on inflation and activity," he said.
