World Bank Predicts Global Economy To Experience Worst Half-Decade Of Growth In 30 Years

The World Bank has issued a grim forecast for the global economy, with a slow growth projection for the next half-decade, the lowest in 30 years.

What Happened: The World Bank released its latest “Global Economic Prospects” report, revealing a forecast of a third consecutive year of slow global growth in 2024, down to 2.4% from 2.6% in 2023, reported CNBC.

The report also predicts a marginal rise to 2.7% in 2025. This growth would still be significantly lower than the average rate in the 2010s.

Despite the global economy’s resilience against recessionary risks in 2023, the World Bank anticipates fresh near-term challenges due to increased geopolitical tensions, likely leading to slower growth in most economies in 2024 and 2025 compared to the previous decade.

See Also: New Economic ‘Super Cycle’ Spurred By AI And Decarbonization Is On The Horizon: Goldman Sachs Analyst

Why It Matters: A September 2023 forecast by the Organisation for Economic Co-operation and Development (OECD) also painted a gloomy picture for the global economy, attributing the slow growth to the tightening of belts by central banks worldwide and turbulence in the Chinese economy.

This forecast from the World Bank comes in contrast to the prediction of a fresh phase of growth in the global economy, driven by the explosion of artificial intelligence and efforts toward decarbonization, as forecasted by a Goldman Sachs analyst.

While the World Bank report underlines the need for a “major course correction” to avoid a “decade of wasted opportunity,” it also highlights the potential for a turnaround if governments act swiftly to increase investment and strengthen fiscal policy frameworks.

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