The World Bank warned on January 9 that global growth is expected to continue to slow for a third consecutive year in 2024, prolonging poverty and worsening the debt levels of many developing countries. development, according to Reuters.
The first half of 2020 could be the worst in the past 30 years, affected by factors such as inflation, fighting in Ukraine and a spike in interest rates around the world.
Protests by farmers in Germany in early 2024.
In the latest Global Economic Outlook report, the World Bank forecasts that global GDP will grow by 2.4% this year. The rate is 2.6% in 2023, 3% in 2022 and 6.2% in 2021.
According to Ayhan Kose, an economist at the World Bank Group, growth in the period 2020–2024 will be weaker than the years surrounding the 2008-2009 global financial crisis, the 1990s Asian financial crisis and recession in the early 2000s.
According to the World Bank, this year's growth rate is considered the weakest since the 2009 global financial crisis, if the decline due to the COVID-19 pandemic in 2020 is excluded.
Post-COVID-19 impact.
Due to the stagnation of advanced economies, the forecast for global growth in 2025 will be slightly higher at 2.7%, but this figure is slightly lower than the June 2023 forecast of 3%. .0%.
As economic activity is hampered by geopolitical conflicts, the World Bank's goal of ending extreme poverty by 2030 becomes harder to achieve.
The 2020s will pass as a period of wasted opportunity without a major correction. World Bank Group chief economist Indermit Gill predicts that short-term growth will continue to be weak, leaving many developing countries, especially the poorest, stuck in a trap, with high debt levels. and difficult for nearly 1/3 of the population.
People shop at a market in London, England.
One way to spur growth, especially in developing countries and emerging markets, is to accelerate the $2,400 billion in annual investments needed to transition to clean energy and adapt to climate change. behind, according to the World Bank Organization.
The bank has conducted research on rapid and sustained investment acceleration of at least 4% per year and found that this drives growth in manufacturing output and services, and per capita income. and the country's financial position.
However, the World Bank states that achieving such acceleration generally requires comprehensive reforms, including fundamental reforms to expand cross-border trade and financial flows and reform improve the financial and monetary policy framework.