The global economy is expected to stabilise in 2024, but growth will remain sluggish compared to pre-pandemic levels, according to the World Bank’s latest Global Economic Prospects report.
Global growth is projected to hold steady at 2.6 per cent in 2024, before edging up to an average of 2.7 per cent in 2025-26. This is well below the 3.1 per cent average in the decade before the COVID-19 pandemic.
Developing economies are expected to grow 4 per cent on average over 2024-25, slightly slower than in 2023. Low-income economies are expected to accelerate to 5 per cent in 2024 from 3.8 per cent in 2023.
However, the forecasts for 2024 growth reflect downgrades in three out of every four low-income economies since January. Advanced economies are expected to grow at a steady 1.5 per cent in 2024 before rising to 1.7 per cent in 2025.
“The global economy is steadying, but growth is at lower levels than before 2020,” said Indermit Gill, the World Bank Group’s Chief Economist and Senior Vice President. “Developing economies will have to find ways to encourage private investment, reduce public debt, and improve education, health, and basic infrastructure.”
The report highlights the challenges facing developing economies, including high levels of debt service, constricting trade possibilities, and costly climate events. The income gap between developing economies and advanced economies is set to widen in nearly half of developing economies over 2020-24, the highest share since the 1990s.
