UN predicts global economic growth to slow in 2023 and pick up in 2024

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By Michelle Nichols

UNITED NATIONS, January 25 (Reuters) –

Global economic growth is expected to slow to 1.9% this year from an estimated 3% in 2022, according to a United Nations report released Wednesday that blames the COVID-19 pandemic on Russia’s war in Ukraine , high inflation and the climate crisis.

According to the World Economic Situation and Prospects report, this would be one of the lowest growth rates in recent decades.

“Global growth is expected to pick up slightly to 2.7 percent in 2024 if, as expected, some macroeconomic headwinds begin to ease next year,” the report said. “However, the near-term economic outlook remains highly uncertain as numerous economic, financial, geopolitical and environmental risks remain.”

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The International Monetary Fund will release its World Economic Outlook update later this month, but IMF head Kristalina Georgieva

said last week

that she saw no “dramatic improvement” in the current global growth forecast for 2023 of 2.7%, down from about 3.2% last year.

In October, the IMF estimated a 25% chance that global growth would fall below 2% next year – a phenomenon that has occurred only five times since 1970.

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The UN report from the world body’s Department of Economic and Social Affairs says weakened growth in the United States, the European Union and other developed economies has negatively affected the global economy.

It predicted that US gross domestic product would grow just 0.4% in 2023, compared to an estimated 1.8% growth last year. The EU was predicted to grow by 0.2% in 2023, up from an estimated 3.3% in 2022.

In October, the IMF forecast economic growth in the US of 1% in 2023 and 0.5% growth in the EU.

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The report predicted China’s economic growth would accelerate to 4.8% this year after the government abandoned its zero-COVID-19 policy and began easing monetary and fiscal policies. This compares to an expected growth of 3% in 2022.

“But the reopening of the economy is expected to be bumpy. Growth is likely to remain well below its pre-pandemic rate of 6 to 6.5 percent,” the report said.

The IMF forecasts Chinese growth of 4.4% for 2023, Georgieva said last week. (Reporting by Michelle Nichols, Editing by Deepa Babington)

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