From Fortune:

The United Nations recently released a grim global economic forecast for 2024. Factors contributing to the dismal prediction include increasing global conflicts, slow global trade, high interest rates, and escalating climate disasters. The U.N. projects global economic growth to slow to 2.4% this year. The IMF and the OECD released more optimistic forecasts than the U.N.

The United Nations warns on the prospects of prolonged tighter credit conditions and higher borrowing costs for economies with high debt, especially in poorer developing countries. Shantanu Mukherjee reported that fears of a recession in 2023 were averted mainly due to the United States. Despite good microeconomic conditions in the U.S., unsettled situations in the world could fuel inflation “We’re not expecting a recession, per se, but because there is volatility in the environment around us, this is the major source of risk.”

Global inflation is projected to decline from 5.7% in 2023 to 3.9% in 2023. However, in about a quarter of all developing countries, annual inflation is projected to exceed 10% this year. The U.S. economy is expected to decline from an estimated 2.5% in 2023 to 1.4% this year due to falling household savings, high interest rates, and a softening labor market.

The U.N. report said Europe faces “a challenging economic outlook.” GDP in the European Union is forecast to expand from 0.5% in 2023 to 1.2% in 2024, with the increase driven by “a pick-up in consumer spending as price pressures ease, real wages rise, and labor markets remain robust.” Japan, the world’s fourth largest economy, is projected to see economic growth slow from 1.7% in 2023 to 1.2% this year.

The report is less optimistic about China’s economic recovery, saying it was slower than expected due to domestic and international headwinds. In developing regions, Africa’s economic growth is forecast to remain weak with a slight increase from an average of 3.3% in 2023 to 3.5% in 2024. Despite these challenges, there is still hope for growth in India.



Read more: U.N. forecasts global economic growth slowdown to 2.4% in 2024 from an estimated 2.7% in 2023