Global outlook is uncertain

ECONOMY: CHIEF ECONOMISTS DIVIDED

For sub-Saharan Africa, 35% expect weak growth, 36% say high inflation.

Chief economists from all over the world are divided over whether the global economy will weaken this year – with 56% of them expecting it to weaken, while 43% foresee unchanged or stronger conditions – illustrating that uncertainty still dominates the outlook for nearterm economic developments.

The January 2024 Chief Economists Outlook was launched this week amid protracted weakness in global economic conditions and widening regional divergence.

It is a quarterly briefing based on the latest policy development research, as well as consultations and surveys with leading chief economists from the public and private sectors, organised by the World Economic Forum’s Centre for the New Economy and Society.

Thirty chief economists provided their feedback for the November-December 2023 survey.

While they noted positive developments, such as easing inflationary pressures and advances in the field of artificial intelligence (AI), they said businesses and policymakers face persistent headwinds and continued volatility as global economic activity remains slow, financial conditions remain tight and geopolitical rifts and social strains continue to grow.

Broken down into regions, the results highlighted diverging growth patterns, with the most buoyant economic activity still expected in South and East Asia, although China remains an exception, with the previous combination of strong and moderate growth expectations replaced with largely moderate (69%) expectations for 2024.

In the US, Middle East and North Africa, the outlook has weakened since the September 2023 edition, with about six out of 10 respondents expecting moderate or stronger growth this year.

In Europe, 77% expect weak or very weak growth. For sub-Saharan Africa, 35% of the respondents expect weak economic growth and 36% expect high inflation.

The economists expect that the relative resilience of the world economy in the recent years will continue to be tested entering 2024, with signs of slowdown in the manufacturing and services sectors.

The International Monetary Fund forecasts a slight decline in global growth to 2.9%, down from 3% in 2023, while the relative resilience in global figures continues to rely on the growth performance of emerging economies.