The UN’s World Economic Situation and Prospects (WESP) report for 2024 forecasts a decline in global growth, dropping from 2.7% in 2023 to 2.4% in 2024. Despite the stronger-than-expected GDP growth in 2023 post-COVID-19, the report flags underlying risks and vulnerabilities in the world economy.
Factors like persistently high interest rates, escalating conflicts, sluggish international trade, and frequent climate disasters present challenges to global growth. Tighter credit conditions and increased borrowing costs pose hurdles for an indebted world economy, urging the need for substantial investments to stimulate growth, combat climate change, and progress toward the Sustainable Development Goals (SDGs).
UN Secretary-General António Guterres stressed the necessity to unlock significant investments to drive sustainable development and climate action, advocating for a $500 billion yearly SDG Stimulus to strengthen global economic growth.
The report anticipates a global decline in inflation from 5.7% in 2023 to 3.9% in 2024 but warns of persistent price pressures in several countries, particularly if geopolitical conflicts intensify.
Approximately a quarter of developing nations are expected to grapple with annual inflation surpassing 10% in 2024, affecting economic gains achieved post-COVID-19 recovery. The UN urges strengthened global cooperation, trading system reform, debt resolution, and increased climate financing to promote sustainable and inclusive growth.
The report highlights economic projections, including a predicted slowdown in the US GDP growth to 1.4% in 2024 due to high-interest rates and a weakened labor market. China is expected to experience a moderate slowdown at 4.7% growth amid domestic and international challenges. Europe and Japan face similar growth challenges, both anticipated at 1.2% growth in 2024.
The report underscores the immediate need for addressing these challenges, emphasizing global cooperation in climate action, sustainable financing, and tackling debt sustainability issues faced by low and middle-income countries. Enhanced global cooperation is crucial to navigate these complex economic landscapes.
