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The report said there was a risk of prolonged low growth amid the worsening impacts of climate change, stubborn inflation, rising interest rates and heightened uncertainty.
challenging development
The current global economic outlook also poses pressing challenges to achieving the Sustainable Development Goals (SDGs), said Junhua Li, Deputy Secretary-General of the Ministry of Economy and Social Affairs (DESA).
“The international community urgently address growing shortages It will lead to increased financial resources facing many developing countries, strengthen their capacity to make critical investments in sustainable development, and support economic transformation. Achieve inclusive and sustainable long-term growth,” He said.
According to the report, the global economy is currently 2.3% in 2023, 2.5% in 2024According to a report prepared by DESA, the global growth forecast for 2023 is slightly up.
Regional impact
In the US, the 2023 growth forecast has been revised upward to 1.1% as household spending recovers.
The European Union economy is now forecast to grow by 0.9%, driven by lower petrol prices and strong consumer spending. China’s growth rate in 2023 is forecast to be 5.3% as a result of the lifting of COVID-19 related restrictions.
leaves a bleak image
Despite this uptick, growth is still well below the 20-year pre-pandemic average of 3.1%.
Economic growth prospects are deteriorating in many developing countries. tightening of credit terms Rising external funding costs. Gross domestic product (GDP) per capita is projected to increase only modestly in Africa, Latin America and the Caribbean this year, reinforcing long-term growth trends. Sluggish economic performance.
Growth in the least developed countries is projected to be 4.1% in 2023 and 5.2% in 2024, far below the 7% growth target set in the 2030 Agenda for Sustainable Development.
Global trade still under pressure Geopolitical tensions, weakening global demand, and tightening monetary and fiscal policies are to blame. Global trade in goods and services is projected to grow by 2.3% in 2023, well below pre-pandemic trends.
Eggs for sale at a food market in Medellin, Colombia.
stubborn high inflation
Inflation remained high in many countries despite a significant drop in international food and energy prices last year.average Global inflation forecasted at 5.2% In 2023, it has fallen from a 20-year high of 7.5% in 2022.
Inflation pressures are expected to ease gradually, but inflation will remain well above central bank targets in many countries.middle local supply disruptionhigh import costs and market imperfections, domestic food inflation is still rising in most developing countries, unfairly affect the poorespecially women and children.
Risks for developing countries
The rapid tightening of global financial conditions poses significant risks to many developing and transition economies. rising interest ratesCoupled with the move from quantitative easing to quantitative tightening in advanced economies, debt vulnerabilities have worsened, further constraining public spending options.
Current policy challenges require: Strengthening cross-border policy cooperation And we took concerted global action to prevent many developing countries from falling into a vicious cycle of low growth and high debt.
A woman waters vegetables in a market garden set up on formerly degraded land in Oualam, Niger. The gardens are shared by refugees, internally displaced persons and local residents.
labor profit
Labor markets in the United States, Europe and other advanced economies continue to show remarkable resilience, contributing to sustained economic growth. robust household spending. Wage growth has accelerated amid widespread labor shortages and low unemployment.
Employment rates are at record highs in many advanced economies, and the gender gap has narrowed since the pandemic.
exceptionally strong labor market However, it is becoming more difficult for central banks to keep inflation in check.The Federal Reserve, the European Central Bank, and other central banks in advanced economies continue to raise interest rates But it will be at a slower pace than last year, the most aggressive monetary tightening in decades.
Disturbances in the US and European banking sectors added to the blow. New uncertainties and challenges for monetary policy.
Swift and decisive action by regulators has helped contain financial stability risks, but Vulnerabilities in global financial architecture And the steps taken to contain them are likely to curb future credit and investment growth.
Workers sell bread at a bakery in Constantine, Algeria, during the COVID-19 pandemic.
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