The global economy, which just six months ago showed signs of stabilization after a series of large-scale natural and man-made shocks, is once again facing the threat of a sharp slowdown. Leading economists at the World Bank note that the situation has changed rapidly, and the risks to global prosperity have significantly increased.
This is reported by Business • Media
“Just six months ago, it seemed that a ‘soft landing’ was expected for the global economy, which had stabilized after an extraordinary series of both natural and man-made disasters over the past few years. But that moment has passed,”
Causes of Global Growth Slowdown
Experts point out that the main reason for the threats to economic development has been international trade disputes and tariff wars, which are increasing uncertainty worldwide. Without prompt changes to the economic course, this could have a significant negative impact on the standard of living in many countries.
According to World Bank estimates, by 2025, these shocks will have already reduced the growth rate of global gross domestic product by nearly 0.5%, to a level of 2.3%. This would be the weakest performance in the last 17 years, excluding periods of global recessions.
Consequences for Developing Countries
Economists predict that the current trend will continue. In the period leading up to 2027, the average annual growth of global GDP will be only 2.5%. This will be the slowest growth rate for any decade since the 1960s. The poorest countries will be particularly hard hit, where the standard of living may steadily decline, and emerging markets will face the threat of stagnation.
To prevent further deterioration of the situation, experts recommend restoring normal trade relations between countries, ensuring fiscal discipline, and accelerating the creation of new jobs, which is especially important in the context of global demographic changes.