World Bank Report: Global Economy Faces Slowest Five Year Growth in 30 Years

The latest Global Economic Outlook report released by the World Bank shows that the global economic growth rate in 2024 will decrease from 2.6% in 2023 to 2.4%. The World Bank stated that the third decade of the 21st century is almost halfway through, but unfortunately, by the end of 2024, the global economy will have to face the slowest five years of gross domestic product (GDP) growth in 30 years.

The report points out that although the positive momentum of the US economy has greatly reduced the risk of global economic recession, the increasingly tense geopolitical situation 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 tight financial conditions in decades, the medium-term prospects for many developing economies have become bleak. The global trade growth in 2024 is expected to be only half of the average level of the decade before the pandemic. The borrowing costs of developing economies are likely to remain high, especially for those with poor credit ratings, as inflation adjusted global interest rates remain at a 40 year high.

The World Bank stated that the economic growth of developing economies is expected to be only 3.9% in 2024. Low income countries are expected to grow by 5.5%, weaker than previously anticipated. By the end of 2024, approximately 25% of developing countries and around 40% of low-income countries will still be poorer than before the pandemic. The growth rate of developed economies will slow down from 1.5% in 2023 to 1.2% this year.

Without significant adjustments, the 2020s will be a decade of missed opportunities, "said Ingemet Gill, Chief Economist and Senior Vice President of the World Bank Group