The World Bank released its latest Global Economic Outlook report on January 9th local time, predicting that the global economic growth rate will slow down for the third consecutive year in 2024, dropping to 2.4%, lower than the 2.6% in 2023 and consistent with the June 2023 forecast; In 2025, it rose to 2.7%, a decrease of 0.3 percentage points from previous expectations. The World Bank predicts that the global economy will grow by 2.2% from 2020 to 2024, the weakest five-year growth rate since the early 1990s. The recent report on weak growth indicates that despite a series of shocks in the past four years, the global economy has shown unexpected resilience. Major economies have not experienced the usual sharp increase in unemployment or financial system collapse during the fastest interest rate hike in 40 years. Global inflation has been controlled, and the world economy has not fallen into recession. However, the prospects for the next two years are not optimistic. The end of 2024 will mark the midpoint of the 10-year development period, which was originally expected to undergo a transformation - extreme poverty will be eliminated, major infectious diseases will be eradicated, and greenhouse gas emissions will be reduced by nearly half, but the reality is not satisfactory. Major international institutions are not optimistic about the world economic growth in 2024. The United Nations released its "2024 World Economic Situation and Outlook" earlier this month, predicting that the world economic growth rate will decrease from 2.7% in 2023 to 2.4% in 2024. The World Bank report shows that the escalating geopolitical tensions may bring new short-term risks to the world economy. At the same time, with the slowdown in growth in most major economies, sluggish global trade, and the most tightening financial conditions in decades, the medium-term prospects of many developing economies have become bleak. The growth of global trade in 2024 is expected to be only half of the average level of the first 10 years of the COVID-19 epidemic. The borrowing costs of developing economies, especially those with poor credit ratings, are likely to continue to rise, as global interest rates, adjusted for inflation, remain at 40 year high levels. Specifically, the report predicts that the economic growth rate of developed economies will slow down from 1.5% in 2023 to 1.2% this year, while developing economies are expected to only grow by 3.9% this year. Low income countries are expected to grow by 5.5% this year, which is weaker than previous expectations. The report predicts that by the end of 2024, about 25% of the population in developing countries and about 40% of the population in low-income countries will still be poorer than before the COVID-19 outbreak. The report predicts that China's economic growth rate will decrease to 4.5% in 2024 and further to 4.3% in 2025. Compared with the forecast for June 2023, the growth rates for both 2024 and 2025 have decreased by 0.1 percentage points, mainly due to a weakening of domestic demand. During the forecast period, structural obstacles such as increased debt, aging and shrinking labor force, and shrinking space for productivity catch-up growth are expected to put pressure on economic activity. "In the near future, growth will continue to be weak, causing many developing countries, especially the poorest, to fall into difficulties and face heavy debt pressures, with nearly one-third," said Indimet Gill, Chief Economist and Senior Vice President of the World Bank Group
Edit：Hou Wenzhe Responsible editor：WeiZe
Source：economic daily
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