On
January 17, the World Bank released its Global
Economic Prospects report, offering insights into the global
economy’s trajectory. The report, published at 03:00 KST (corresponding to
13:00 on January 16 in Washington, D.C., under international embargo),
forecasts a 2.7% global growth rate in 2025 based on market exchange rates,
aligning with the June 2024 projection.
The
World Bank anticipates that declining inflation and easing monetary policies
will support stable growth across advanced and developing economies. However,
the projected growth remains modest and insufficient to fully offset the
cumulative damage caused by consecutive external shocks in recent years.
For
advanced economies, growth in 2025 is expected to remain at 1.7%, consistent
with the June forecast. The United States is projected to experience a gradual
slowdown, reflecting signs of softening in the labor market and consumer
sentiment. Conversely, the Eurozone is expected to see recovery driven by
improved investment and trade, while Japan’s growth is likely to benefit from
increased capital investment and stronger consumer spending.
Emerging
and developing economies are forecasted to grow by 4.1% in 2025, a slight
upward revision of 0.1 percentage points from the June projection. China is
expected to face slowing growth due to weak domestic demand, while India and
the broader South Asia region are poised to maintain robust growth. In
contrast, Russia’s economy is forecasted to weaken amid a slowdown in private
consumption and investment. Geopolitical tensions, particularly the ongoing war
in Ukraine, are expected to remain a significant risk for Eastern Europe and
Central Asia.
The
report underscores persistent downside risks to the 2025 outlook. These include
heightened policy uncertainty, adverse shifts in trade policies, escalating
geopolitical risks, rising inflation, slowdowns in major economies, and
climate-related natural disasters.
The
World Bank highlights the critical role of international cooperation in
addressing trade fragmentation and the debt vulnerabilities of developing
nations. It calls for monetary policies focused on price stability,
strengthened financial oversight, and enhanced risk management to safeguard
financial system stability. The report also emphasizes the importance of fiscal
sustainability through prudent spending, balanced investment strategies, and
fostering labor market inclusivity to promote broader economic participation.
By addressing these pressing challenges, the World Bank aims to pave the way for a more resilient and sustainable global economy in the years ahead.