THE World Economic Forum (WEF) has projected that Europe will experience the worst economic growth in 2024 relative to other regions.
The WEF disclosed this in a publication, Chief Economists Outlook January 2024,’ as it commenced its 54th Annual Meeting at Davos-Klosters earlier this week.
The report resulted from a survey of 30 chief economists, exploring vital economic trends, including growth and inflation prospects, and the implications of recent geopolitical, industrial policy, and artificial intelligence (AI) developments.
It indicates that 67 per cent of the economists anticipated weak economic growth for the European region.
“The change in the outlook for Europe is particularly stark, with the share of respondents expecting weak or very weak growth almost doubling to 77% since September,” it stated.
Relatively, all the other regions of the world are projected to have moderate economic growth except South Asia, which 52 per cent of the economists say will have robust economic growth in the year in view.
The U.S., China, Central Asia, East Asia and Pacific, Middle East and North Africa, Latin America and the Caribbean, and Sub-Saharan Africa will pose moderate growth.
For sub-Saharan Africa, it specified that 65 per cent of the economists project moderate growth for the region.
“Chief economists continue to see the most buoyant economic activity in the economies of Asia, although no region is slated for very strong growth in 2024,” the report stated.
It revealed that global economic prospects will remain uncertain as it grapples with headwinds from financial conditions, geopolitical risks, and generative AI (GenAI) progress.
It explained that 69 per cent of the economists agree China expects moderate growth amid weak consumption, lower industrial production and property market, while 53 per cent see U.S. economic growth to moderate.
A further look at the report shows that seven in 10 economists agree the pace of global fragmentation will accelerate, with 59 per cent expecting the global economy to weaken. In contrast, two-thirds agree that industrial policies will create new growth hotspots.
Other highlights in the report are that most economists warn of rising fiscal strains and divergences between higher-lower income economies and expect GenAI to increase productivity and innovation.
In the year in view, all the regions are expected to experience moderate inflationary pressure except China, which is projected to record a low inflation rate.
“At the start of 2024, global inflation continues to ease, propping expectations of mild ebbing in interest rates this year. The global headline rates of inflation are projected to reach 4.8%, a sharp decline from 5.9% in 2023 and 9.2% in 2022.
“Core inflation is decelerating too, albeit at a slower pace, and is expected to reach 4.5% in 2024. The easing is reflected in the latest survey results, with expectations for high inflation being pared back across all regions,” the report also indicated.