Global economy poised to strengthen in 2024, but challenges remain
According to the latest Chief Economists Outlook by the World Economic Forum, chief economists are optimistic about the global economy’s prospects, with as many as 82 percent expecting growth or stability this year. This marks a significant shift from earlier predictions, with only 17 percent anticipating a downturn in global conditions.
Despite this positive outlook, concerns loom over geopolitical and domestic political tensions that could impact economic volatility. Over 97 percent of respondents foresee geopolitics playing a role in global economic instability this year, while 83 percent highlight domestic politics as a source of volatility in 2024.
Saadia Zahidi, managing director of the World Economic Forum, emphasized the need for policy-making that fosters inclusive, sustainable, and resilient growth to navigate the complex economic landscape. While improvements are evident, growth expectations vary across regions.
The United States is poised for strong growth, with 97 percent of chief economists anticipating moderate to robust expansion this year, a significant rise from earlier projections. Asian economies also show promise, particularly in South Asia and East Asia, where all respondents expect at least moderate growth.
In contrast, Europe’s outlook remains pessimistic, with nearly 70 percent of economists predicting weak growth ahead. The survey underscores the increasing challenges faced by businesses and policymakers, as tensions between political and economic factors are expected to escalate, impacting decision-making processes.
The road to sustained global growth in the coming years appears promising, with almost 70 percent of chief economists eyeing a return to 4 percent growth within the next five years. High-income countries anticipate growth driven by technological advancements, artificial intelligence, and green energy transitions. However, opinions on the impact of these factors in low-income economies vary.
Amidst the economic landscape’s complexities, chief economists stress the importance of considering various factors like the global economy’s health, monetary policies, financial markets, labor conditions, geopolitics, and domestic politics when making corporate decisions. While growth objectives remain a priority, there is a growing awareness of the role of environmental and social goals in shaping companies’ strategies.
