Global economic growth to slow to 2.6% in 2024: UNCTAD

This marks the third consecutive year of growth below the pre-pandemic rate, which averaged 3.2 per cent between 2015 and 2019.

Africa is projected to grow at 3 per cent this year, up slightly from 2.9 per cent in 2023. Armed conflicts and climate impacts pose significant challenges in several countries in the continent, whose largest economies—Nigeria, Egypt and South Africa—are underperforming, affecting overall prospects, UCTAD said in a release.

In Asia, China targets around 5 per cent growth this year, capitalising on robust manufacturing and trade. India's economy is buoyed by strong public investment and service sector growth, with a forecasted expansion of 6.5 per cent this year. Japan is expected to grow at 1 per cent amid export demand challenges.

Major economies in Europe are witnessing economic slowdowns, with France, Germany and Italy projecting growth of 1.3 per cent, 0.9 per cent and 0.8 per cent respectively due to industrial and fiscal challenges.

Economic growth is slowing in South America, with Brazil expected to grow at 2.1 per cent, hampered by external pressures and commodity dependence. Argentina faces a 3.7-per cent contraction due to inflation and complex debt negotiations.

Growth remains relatively resilient in North America, though challenges continue. The United States is expected to grow at 2 per cent this year, reflecting concerns over high household debt levels.

A UNCTAD report released ahead of the 2024 Spring Meetings of the International Monetary Fund and the World Bank cautions that the prevailing focus on inflation overshadows urgent issues like trade disruptions, climate change and rising inequalities.

It calls for structural reforms and coordinated global efforts, proposing a comprehensive strategy that includes both supply-side policies to boost investment and demand-side measures to improve employment and income.

The report highlights the global economy's growing reliance on private consumption, projected to increase by about 4 per cent, outpacing total income growth of 2.6 per cent.

Another worrying trend is that inequality in the labour market continues to rise post-pandemic, with workers in both developed and developing countries earning a reduced share of income.

This indicates that the benefits of economic growth are increasingly reaped by capital owners rather than by workers, widening wage and wealth gaps, The UNCTAD release said.

The report highlights an uneven post-pandemic recovery.

Fibre2Fashion News Desk (DS)