Global growth rate slows to 2.6% in 2024 amid uneven recovery: UNCTAD

Global economic growth is anticipated to slow to 2.6 percent in 2024, with the UN Trade and Development agency highlighting an uneven post-pandemic financial recovery among countries.

In its latest report, UNCTAD revealed that the prevailing focus on inflation, which is overshadowing other critical issues like trade disruptions, climate change, and rising inequalities, is driving the economic slowdown in various countries.

The study also noted that Saudi Arabia’s economy is expected to increase by 2.7 percent in 2024, down 0.2 percent compared to its previous projection.

In Asia, China’s economy is projected to grow 5 percent in 2024, while India’s output will expand by 6 percent, driven by substantial public investment and service sector growth.

On the other hand, several European countries are expected to face an economic slowdown in 2024, with France, Germany, and Italy expected to grow at a moderate rate of 1.3 percent, 0.9 percent, and 0.8 percent, respectively.

In North America, development remains relatively resilient, even though challenges continue. The US economy is projected to grow at 2 percent in 2024, reflecting concerns over high household debt levels, UNCTAD added.

In South America, the economic growth is slowing, with Brazil expected to develop at 2.1 percent, hampered by external pressures and commodity dependence, while Argentina faces a 3.7 percent contraction due to inflation and complex debt negotiations.

Additionally, the African economy will grow by 3 percent this year, with armed conflicts and climate impacts posing significant risks to several continental nations.

The report also added that inequality in the labor market continues to rise post-pandemic, with workers in both developed and developing countries earning a reduced share of income.

“This indicates that the benefits of economic growth are increasingly reaped by capital owners rather than by workers, widening wage and wealth gaps,” UNCTAD said.

Earlier this month, the International Monetary Fund revealed that global economic growth, estimated at 3.2 percent in 2023, is projected to continue at the same pace in 2024 and 2025.

IMF added that global headline inflation is forecasted to slip to 5.9 percent this year after 2023’s 6.8 percent average.

However, the IMF warned that it is still too early to declare victory in the fight against inflation.