UNCTAD announces global growth forecast
According to the UNCTAD report, world economic growth rate will slow down to 2.6 percent this year.
According to the Trade and Development 2026 report published by the United Nations Conference on Trade and Development (UNCTAD), global economic growth is expected to drop to 2.6 percent this year.
Global Growth Prospects
The United Nations Conference on Trade and Development (UNCTAD) published its Trade and Development 2026 report, predicting that the world economy will drop to 2.6 percent this year following a 2.9 percent growth in 2025.
While emphasizing that high energy prices caused by the war in the Middle East are testing the global economy and financial stability, the organization set its growth forecast for 2027 at 2.7 percent.
Developing Economies
Growth in developing economies is expected to decline from 4.7 percent in 2025 to 4 percent this year.
While these countries face new technological and policy barriers, the developing world as a whole is failing to catch up with advanced economies, with the exception of a few fast-growing Asian economies.
State of Advanced Economies
Advanced economies generally exhibit weak industrial performance while absorbing stagnation, tightening monetary conditions, and energy shocks.
The US economy is expected to grow by 2.1 percent in 2026 and 1.8 percent in 2027, with artificial intelligence investments and a stable labor market supporting demand, though persistent inflation erodes real wages.
Cross-Regional Divergences
Western Europe is stuck in a low-growth phase vulnerable to sluggish investment, trade fragmentation, and fluctuations in energy prices.
Meanwhile, some advanced Asian economies such as South Korea and Japan benefit from vibrant global demand driven by demand for high-tech components and sustained semiconductor investments.
Trade Volume and Artificial Intelligence
Global trade in goods and services, which hit a record $35 trillion last year driven by rising prices, is projected to grow by 4 percent this year.
While artificial intelligence stands as the most important driver of dynamism in trade, only a limited number of economies are benefiting from this boom.