World Bank sees global growth slowing for 3rd straight year in 2024

WASHINGTON: The World Bank has forecast a bleak outlook for the global economy with growth expected to slow down for a third year in a row in 2024, according to its Global Economic Prospects report released on Tuesday.

The report projects the world economic growth to come down further to 2.4 per cent in 2024, before edging up to 2.7 perc ent in 2025 -- well below the 3.1 percent average growth seen in the 2010s.

After 6.2 per cent in 2021 which is attributed to a low base due to the Covid-19 pandemic, the World Bank estimates global growth cooled to 3 per cent in 2022 and then to 2.6 per cent in 2023.

Hamstrung by the Covid-19 pandemic, then the war in Ukraine and ensuing spikes in inflation and interest rates around the world, the first half of the 2020s now looks like it will be the worst half-decade performance in 30 years, the report states.

"Yet beyond the next two years, the outlook is dark," Indermit Gill, the bank's chief economist, said in a statement.

"The end of 2024 will mark the halfway point of what was expected to be a transformative decade for development — when extreme poverty was to be extinguished, when major communicable diseases were to be eradicated, and when greenhouse-gas emissions were to be cut nearly in half," Gill added.

That would make growth weaker in the 2020-2024 period than during the years surrounding the 2008-2009 global financial crisis, World Bank Deputy Chief Economist Ayhan Kose said.

Meanwhile, the World Bank sees India's growth inching up from 6.3 per cent in 2023-24 to 6.4 per cent in 2024-25 and 6.5 per cent in 2025-26.

"India is anticipated to maintain the fastest growth rate among the world's largest economies, but its post-pandemic recovery is expected to slow," the World Bank's report said.

Investment is envisaged to decelerate marginally but remain robust, supported by higher public investment and improved corporate balance sheets, including in the banking sector, the report added.