What Chief Economists Predict for the Global Economy in 2024

 A survey of chief economists revealed that 61% predict a decrease in the global economy in the coming year.

• A majority of economists, 61%, forecast that the global economy is likely to become weaker in the upcoming year, as indicated in the World Economic Forum's Chief Economists Outlook.
• Optimism is high among 86% of top economists that the inflationary swell around the world will abate.
• Professionals in the financial field caution that the economic outlook could hinder progress towards global development objectives, with 74% of them believing that geopolitical tensions will have the same effect.

 The way we perceive the world is heavily impacted by the media we consume; what we see and hear influences our outlooks and opinions. It is thus important to be aware of the media we take in and how it shapes our worldview. We must be mindful of the messages we receive and the impact they can have on us.

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 It could be argued that the single word that best encapsulates the future of the global economy in the approaching year is "volatility".

 The World Economic Forum's latest report, Chief Economists Outlook from September 2023, indicates that geopolitics could be a major cause of market instability.

 Nevertheless, the report suggests that the situation is complex, and there are more promising developments that may take place, such as declines in inflation and a deceleration of interest rate increases.

 The September 2023 edition of the Chief Economists Outlook produced some noteworthy conclusions.

Could the global economy be weak in 2024?

 A majority of the chief economists interviewed for the report (61%) forecast that the global economy will become weaker in the next year.

 It is generally anticipated that the worldwide economy will experience a decline in the upcoming year.

 When the May edition of the Chief Economists Outlook was released, uncertainty was a main element. Although the fear of a worldwide recession is waning, worries about China's economy, which experienced deflation recently, are increasing.

 It is predicted by nine out of ten economists that geopolitical and domestic political matters will create economic instability in the approaching year.

 This image serves as a visual representation of the theme of the Forum. It depicts the concept of collaboration in an effort to build a better future.

 79% of respondents indicated that internal political issues could result in economic instability, with the upcoming American election season potentially contributing to this feeling.

Economic conditions in different areas

 A look at the various regional economic outlooks reveals varying degrees of prosperity.

 The Outlook of the Chief Economists reports that there is an increase in differences in economic prospects worldwide.

 In Asia, particularly South Asia, there is an expectation of significant growth for the current year, with 92% expecting moderate to strong growth. This is an increase from the 36% who expected strong growth in the May report.

 Expectations for China have decreased significantly. In the May edition, 97% of people expected moderate or strong growth in the coming year, but that number has dropped to 54%. There is not much hope that the outlook will improve in 2024.

 The latest report has noted that the Chinese economy is facing some headwinds, such as a slower recovery of domestic consumption than expected, deflationary tension, and some evidence of fragility in the real estate sector. Additionally, trade activity has declined significantly, with imports declining by 12.4% and exports by 14.5% in the year up until July 2023.

 What measures is the World Economic Forum taking to assist corporations in navigating the trade disagreement?

 The predictions regarding the US economy have seen a major upsurge since May, with 80% of those surveyed anticipating either substantial or moderate expansion in the current and next year, as opposed to the 50% in May.

 Of those surveyed, 77% expect that Europe will experience weak or very weak economic growth in the current year. However, the outlook for 2024 appears to be more optimistic, with only 41% anticipating feeble growth.

 Regarding the Middle East and North Africa, a 15% increase has been recorded from May in which 79% now anticipate moderate or powerful expansion within 2023 and 2024.

Signs of a Let-up in Inflation and Interest Rates

When considering the forecast for inflation, there is a general sense of optimism among chief economists, with the majority (86%) expecting the global inflationary surge to have passed in a year's time.

 When it comes to monetary policy, the majority of respondents (93%) anticipate a deceleration in the rate of interest rate increases for economies prone to inflation. Additionally, 8 out of 10 chief economists presume that central banks will no longer pursue a synchronized policy.

 It appears to be less probable that monetary policy will become synchronized, as some central banks have become more successful in keeping a lid on inflation.

 The report states that a cautious mood prevails, and that monetary policy is likely to be cautiously managed in the coming months due to the delicate economic landscape, encompassing climate change, demographic shifts, and intensifying geopolitical and economic divisions.

 Moderate or lower US inflation is now expected by 54% of chief economists, up from the 32% that were expecting that in May. As for Europe, the majority of respondents still view it as heading towards high or very high inflation in 2021.

 According to 81% of chief economists, China is currently dealing with deflationary pressures, and this percentage is much higher than the 48% of those who anticipated such pressures in May.

 Effects of economic declines affect worldwide progress

The timeline for the UN's Sustainable Development Goals to be accomplished by 2030 could be hindered due to the current economic state of the world.

The findings of a survey revealed that the majority of participants (74%) believed that geopolitical tensions will impede progress toward the global development goals in the following three years. Additionally, the same percentage (59%) of respondents predicted that tighter economic conditions will have the same result.

The UN's Sustainable Development Goals (SDGs) by the 2030 end date are put in jeopardy due to the adverse effects the world economy is experiencing.

 The most recent UN Sustainable Development Report revealed a declining pattern over the past year in regards to numerous Sustainable Development Goals, such as the elimination of extreme poverty and a decrease in food insecurity.

According to UNCTAD, the amount of money invested each year is not enough to meet the objectives of the SDGs. This is evidenced by a difference of $4 trillion in investment compared to the 2015 target of $2.5 trillion when the SDGs were first established.

 In order to make a difference in developing countries, seeking ways to mobilize finance could be of great help. The chief economists suggested that private capital could be the key to the digital transformation, energy, food, and climate efforts, which will bring positive results in all fields of development.