GDP Projected to Slow in Developed Countries, Grow in Developing Countries
The UN Department of Economic and Social Affairs released its flagship annual economic report, World Economic Situation and Prospects 2024, on January 3. The report offers a somber economic outlook for the near term, citing high interest rates, instability and conflict, sluggish international trade, and increasing climate disasters.
Global GDP growth is projected to slip from 2.7% in 2023 to 2.4% in 2024. The US is projected to see the largest percentage decrease, from 2.5% in 2023 to 1.4% in 2024. Western Asia has the largest projected increase, from 1.7% in 2023 to 2.9% in 2024.
Global headline (total) inflation is expected to decline to 3.9% in 2024, a welcome change from the 8.1% inflation seen in 2022. However, food prices remain high: In 2023, acute food insecurity rose to an estimated 238 million people, an increase by 21.6 million people from 2022.
Real gross fixed capital formation is expected to remain lackluster. It rose by around 1.9% in 2023, but this was far below the average 4.0% growth rate seen 2011–2019.
Global trade decreased to 0.6%, significantly below 5.7% in 2022, but it is expected to recover to 2.4% in 2024. Services in tourism and transport continued to rebound, while exports from developing countries suffered setbacks.
World energy investment is estimated to have increased by 7% to $2.8 trillion in 2023, while the share of clean energy in total energy investment increased from 60% in 2020 to 62% in 2022. Meanwhile, investment in fossil fuels surpassed pre-pandemic levels in 2022 and 2023.
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