Doha: The global economy is poised to deliver a stable growth rate of 3.2% in 2024, demonstrating remarkable resilience despite facing significant challenges earlier in the year. This rate, although lower than the historical average of 3.6% between 2000 and 2023, remains comfortably above the 2.5% recession threshold, according to QNB’s latest economic commentary.
Forecasts for 2025 mirror this stability, with growth expectations also pegged at 3.2%. The World Economic Outlook (WEO), a flagship report by the International Monetary Fund (IMF), highlights the underlying factors sustaining global growth, offering a unified perspective on global trends, risks, and opportunities.
Key Drivers of Stability
- Balanced Economic Growth Across Regions
Advanced Economies (AE): The group, comprising 40% of the global economy, is projected to grow at 1.8% annually in 2024-2025. While the US economy may slow from 2.8% to 2.2%, this deceleration will be balanced by improved performance in the Euro Area, UK, Japan, and other advanced nations.
Developing Economies (DE): Growth remains robust at 4.2% annually, with gains in Latin America, the Middle East, Central Asia, and Sub-Saharan Africa compensating for modest slowdowns in Asia and Europe. - Easing Monetary Policies
Major central banks, including the US Federal Reserve and the European Central Bank, are implementing interest rate cuts following successful efforts to curb inflation. This monetary easing supports economic activity in advanced economies and generates positive spillover effects for developing regions.
Even amid uncertainties like regional conflicts, fluctuations in commodity prices, and China’s property market challenges, these measures are expected to stabilize growth and mitigate potential risks.
- Steady International Trade
Despite geopolitical tensions and growing geo-economics fragmentation, global trade volumes as a percentage of GDP are set to remain steady. Trade within geopolitical blocs is increasing, offsetting potential disruptions between blocs.
In the absence of severe trade conflicts, international trade is likely to continue boosting global productivity and investment, reinforcing economic stability in the short term.
Outlook for 2024 and Beyond
The interplay of steady growth across economies, proactive monetary policies, and resilient trade flows ensures the global economy remains on a stable trajectory. While risks such as inflationary pressures, financial market volatility, and geopolitical uncertainties persist, the resilience demonstrated thus far offers an optimistic outlook for 2024 and 2025.
