Global Economy Faces Challenges Amid Resilience and Uncertainty

The United Nations forecasts the global economy to grow by 2.7% this year, with prospects improving to 2.9% by 2027. Economic uncertainties, geopolitical tensions, and higher US tariffs are key factors impacting growth. However, resilience is observed in consumer spending, with growth in developing regions like China, India, and Indonesia.

The United Nations has downgraded its forecast for global economic growth to 2.7% this year, attributing the decline to increased US tariffs and geopolitical tensions causing economic uncertainties. The projection for 2027 shows a modest uptick to 2.9%, still under the pre-COVID-19 average of 3.2%.

UN economists highlight the tenacity of consumer spending amidst these challenges, buoyed by easing inflation, but note underlying weaknesses. In the United States, growth is expected to decrease slightly by 2025, with a later uptick, while Japan and the European Union face similar pressures from tariffs and policy uncertainties.

Developing countries like China, India, and Indonesia continue to show robust growth, yet low-income nations remain vulnerable. While some regions see stable progress, others, such as Africa, grapple with high debt and climate challenges. Despite such hurdles, optimism persists with forecasts showing potential modest improvements beyond 2025.

(With inputs from agencies.)