UN report gives cautiously optimistic near-term global economic outlook

UNITED NATIONS - Global economic prospects have improved thanks to strong performances in the United States and large emerging economies, although vulnerabilities remain, says a UN report released on Thursday.

The world economy is now projected to grow 2.7 per cent in 2024 and 2.8 per cent in 2025, according to a mid-year update of the January 2024 World Economic Situation and Prospects report.

The January report predicted a 2.4 per cent global growth rate for 2024 and 2.7 per cent for 2025.

The upward revisions mainly reflect a better outlook in the United States, where the latest forecast points to 2.3 per cent growth in 2024, and several large emerging economies, notably Brazil, India and Russia.

The outlook for China registers a small uptick with growth now expected to be 4.8 per cent in 2024, compared with 4.7 per cent in the January 2024 forecast.

Although the economic outlook for developed economies is revised up from 1.3 per cent to 1.6 per cent for 2024, the European Union's growth is revised down from 1.2 per cent to 1.0 per cent.

Africa and Western Asia are the other two regions that will see slower-than-expected growth.

The report cautions that the outlook is only cautiously optimistic. Higher-for-longer interest rates, debt sustainability challenges, continuing geopolitical tensions and ever-worsening climate risks continue to pose challenges to growth, threatening decades of development gains, especially for least developed countries and small island developing states.

On average, global growth in the coming years is expected to remain below the average of 3.2 per cent during 2010-2019, says the report.

The mid-year update and the January report were prepared by the UN Department of Economic and Social Affairs. - XINHUA