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Global growth won't return to pre-pandemic levels until 2029

Global growth won't return to pre-pandemic levels
World Economic Forum

Leading economists from both the public and private sectors, convened by the Center for the New Economy and Society of the World Economic Forum (WEF), project that global economic activity will regain its pre-pandemic growth pace by the year 2029. This implies that it will take five more years for the global Gross Domestic Product (GDP) to achieve a growth rate of 4 percent.

The WEF did not provide specific growth estimates for this year. However, according to the March update from the International Monetary Fund (IMF), global GDP is expected to grow at a rate of 3.1% this year and the next.

In a survey of leading economists from the public and private sectors, a "cautious optimism with hints of uncertainty" about the global economic situation was highlighted.

This uncertainty is attributed to geopolitical tensions, levels of indebtedness, the economic impact of climate change, and social polarization.

The analysis, published from the WEF headquarters in Geneva, Switzerland, revealed that 82% of respondents anticipate an improvement in the global economy for this year, which would lead to growth similar to that of 2023. This percentage is double that obtained in the same survey conducted in December.

Although no specific emerging economies were directly addressed, 83% of respondents noted that "domestic politics of countries are a factor of uncertainty for this year," with at least 83 nations, including Mexico, in an electoral process.

As for Latin America, 72% of respondents expect moderate growth, while only 24% see it as weak or very weak. For the United States, 97% anticipate moderate to high economic growth.

The IMF projects a growth rate of 2.7% for the United States this year and 1.9% for the next, while for Latin America, it foresees an advance of 2% in 2024 and 2.5% for 2025.

According to the survey results, factors that can drive growth in advanced economies include the development and evolution of Information Technologies (IT) and Artificial Intelligence (AI), especially if applied to energy transition and addressing climate change.

These same elements are identified as limiting factors for the development of emerging economies. Additionally, the importance of innovation, investment in the education sector, personnel training to improve skills, and infrastructure development were highlighted as determinants for driving growth in emerging countries.

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