Global Growth Falters as Economic Storm Clouds Gather

Global economic growth is showing signs of deeper fatigue, with the World Bank now projecting a slowdown to 2.4% in 2025—nearly half a percentage point below earlier expectations. This revised outlook, published in the latest United Nations report, underscores a decade increasingly marked by weak expansion, economic fragmentation, and policy unpredictability.

 “The world economy today is once more running into turbulence. Without a swift course correction, the harm to living standards could be deep,” said Indermit Gill, Chief Economist at the World Bank.

While a full-blown recession isn’t anticipated, the global economy is on track to record its slowest decade of growth since the 1960s, driven by geopolitical tensions, sluggish investment, and uneven recoveries across regions.

 Developing Economies Take the Hit

According to the World Bank, growth forecasts have been downgraded in nearly 70% of all economies, with developing countries facing the sharpest downgrades. Growth across low- and middle-income nations is projected to average just 3.8% in 2025, climbing slightly to 3.9% in subsequent years—more than a full percentage point below their average in the 2010s.

This slowdown threatens to stall key development goals, especially in areas such as:

• Job creation
• Poverty reduction
• Income convergence with wealthier nations

Trade Tensions and Policy Uncertainty

The World Bank attributes part of the drag to elevated trade barriers and lingering policy uncertainty, particularly between major economies like the U.S. and China. The report assumes no further escalation in tariffs, but notes that even the status quo is limiting global trade’s contribution to growth.

 “Economic cooperation is better than any of the alternatives—for all parties,” Gill emphasized, urging countries to rebuild trade ties and strengthen multilateral institutions.

Meanwhile, global vulnerabilities are becoming more pronounced. In a related development, the World Food Programme (WFP) revealed it has no prepositioned food supplies in Haiti ahead of the hurricane season due to funding shortfalls. It also lacks the resources to respond rapidly to potential disasters.

This underscores how economic fragility can quickly spill over into humanitarian risks, especially for vulnerable nations already strained by inflation, conflict, and climate pressures.