The World Bank forecast last week that the world economy will expand just 2.4% in 2024, according to the Associated Press. That would be down from 2.6% growth in 2023, 3% in 2022, and 6.2% in 2021, which reflected the robust recovery from the pandemic recession of 2020. High interest rates, persistent inflation, slumping trade, and a diminished China were a few reasons cited for this year’s projections.
Heightened global tensions, arising particularly from Israel’s war with Hamas and the conflict in Ukraine, pose the risk of even weaker growth. World Bank officials expressed worry that deeply indebted impoverished countries cannot afford to make necessary investments to fight climate change and poverty.
In recent years, the international economy has proved surprisingly resilient in the face of shock after shock. The World Bank now says the global economy grew half a percentage point faster in 2023 than it had predicted back in June and concludes that “the risk of a global recession has receded.”
Leading the way in 2023 was the United States, which likely registered 2.5% growth last year — 1.4 percentage points faster than the World Bank had expected in mid-year. The World Bank, a 189-country anti-poverty agency, expects U.S. growth to decelerate to 1.6% this year as higher interest rates weaken borrowing and spending.
