"Global growth is projected to decelerate from 3.1% in 2022 to 2.1% in 2023. In EMDEs [emerging market and developing economies] other than China, growth is set to slow to 2.9% this year from 4.1% last year. These forecasts reflect broad-based downgrades," the World Bank said in its Global Economic Prospects report.
"Most EMDEs have seen only limited harm from the recent banking stress in advanced economies so far, but they are now sailing in dangerous waters. With increasingly restrictive global credit conditions, one out of every four EMDEs has effectively lost access to international bond markets. The squeeze is especially acute for EMDEs with underlying vulnerabilities such as low creditworthiness. Growth projections for these economies for 2023 are less than half those from a year ago, making them highly vulnerable to additional shocks," the World Bank said.
US Economy Will Decelerate to 0.8% in 2024
The US economic growth is projected to decelerate from 1.1% in 2023 to 0.8% in 2024, the World Bank said.
"After growing 1.1 percent in 2023, the U.S. economy is likely to remain weak in 2024, decelerating to 0.8 percent," the report said.
The report attributed the weak growth to "the lagged effects of the sharp rise in policy rates over the past year and a half."
GDP Growth in Euro Area Forecast to Slow to 0.4% in 2023, Reach 1.3% in 2024
Economic growth in the euro area will decline to 0.4% in 2023 as central banks tighten monetary polity, but GDP growth is expected to recover slightly to 1.3% in 2024, the World Bank said in its latest Global Economic Prospects report.
"Growth is forecast to slow to 0.4 percent in 2023, from 3.5 percent in 2022, owing mainly to the lagged effects of monetary policy tightening. The upward revision of 0.4 percentage point to growth this year relative to January mainly reflects the better-than-expected data at the beginning of the year and the downgrade to energy price projections. After bottoming out in 2023, growth is expected to firm to 1.3 percent in 2024, supported by reforms and investments funded by the Recovery and Resilience Facility. The 0.3 percentage point downward revision to the forecast for 2024 partly reflects the effects of tight monetary policy over a longer period than previously expected," the report said.
Growth in China Projected to Rebound to 5.6% in 2023, Slow to 4.6% in 2024
"Growth is projected to rebound to 5.6 percent in 2023, as the economic reopening drives consumer spending, particularly on domestic services," the World Bank said in its Global Economic Prospects report.
In 2024, the country's economic growth will slow to 4.6%.
"Key downside risks include continuing stress in the real estate sector, a sharper-than-anticipated slowdown in global growth and trade, and the lingering possibility of disruptive COVID-19 waves," the report added.
World Bank Downgrades Ukraine Forecast by 1.3 Percentage Points to 2% for 2023
The World Bank has downgraded its forecast for Ukraine's 2023 economic growth by 1.3 percentage points to 2% amid the disruptions caused by the ongoing conflict with Russia, according to the Global Economic Prospects report.
"In Ukraine [...] the outlook is marked by pronounced uncertainty. Output is anticipated to expand by 2 percent in 2023. This represents a downgrade of 1.3 percentage points since January, mostly to take account of the economic disruptions caused by the destruction of energy infrastructure in the fourth quarter of 2022," the report said.
Crude Oil Prices Projected to Average $80/bbl in 2023
"Crude oil prices are projected to average $80/bbl in 2023, a $8/bbl downward revision from the January forecast, and to edge up to $82/bbl in 2024, reflecting a modest pickup in demand," the World Bank said in its Global Economic Prospects report.
Global Trade Growth to Slow From 6% in 2022 to 1.7% in 2023
"Global trade growth is forecast to slow from 6 percent in 2022 to 1.7 percent in 2023," the report said.
Global goods trade growth slowed in the first half of 2023 along with weakening industrial production, the World Bank added.
The World Bank expects global trade to recover to 2.8% in 2024 mainly as global consumption returns to its pre-pandemic mix between goods and services.