OECD: Global economy to grow by 2.7% in 2024, still faces effects of inflation

The global economy continues to face challenges such as inflation and low growth prospects, according to the OECD’s November economic outlook report. Global GDP growth is projected to be 2.9 percent in 2023 and to weaken to 2.7 percent in 2024 with the effects of tighter financial conditions, weak trade growth, and lower business and demand. As inflation abates further and real incomes strengthen, the world economy is expected to grow by three percent in 2025. Global growth remains highly dependent on the fast-growing Asian economies. According to the report, risks to the near-term outlook remain tilted to the downside and include heightened geopolitical tensions, and a larger-than-expected impact of monetary policy tightening. The OECD and G20 countries’ GDP growths are projected to be at 1.4 percent and 2.8 percent in 2024 and at 1.8 percent and three percent in 2025, respectively. Specifically, the GDP growth forecast for China indicates 4.7 percent for 2024 and 4.2 percent for 2025. The OECD expects India to record the highest growth rate with 6.1 percent for 2024 and 6.5 percent for 2025, while Argentina is projected to record negative growth of 1.3 percent in 2024 and then to grow by 1.9 percent in 2025. The report stated that governments should maintain restrictive monetary policies, prepare fiscal policies ready for future spending pressures, and to keep markets open and implement structural reforms to restore growth.