 "WEF says India remains fastest-growing major economy but global growth to weaken in 2025")
The global economy is likely to face significant headwinds in 2025, with most chief economists predicting weaker conditions, according to a new report released Thursday (January 16) by the World Economic Forum (WEF).
The Chief Economists Outlook report found that 56 per cent of surveyed chief economists expect a decline in global economic conditions, while only 17 per cent anticipate improvement, citing uncertainty in key regions and the need for cautious policy approaches.
India, South Asia to boost global economy
The US economy is forecast to deliver strong growth, while South Asia— driven by India— is expected to remain a bright spot globally. India, the world’s fastest-growing major economy, is projected to maintain robust growth, though signs of slowing momentum have emerged.
India’s year-on-year gross domestic product (GDP) growth fell to 5.4 per cent in the third quarter of 2024, its slowest pace in nearly two years.
That prompted the Reserve Bank of India (RBI), the country’s central bank, to revise its annual growth forecast downward in December.
Despite this, 61 per cent of economists surveyed expect strong or very strong growth in South Asia in 2025.
Outlook for Europe, China remains bleak
In contrast, the outlook for Europe remains bleak, with 74 per cent of respondents predicting weak or very weak growth for the year. China’s economy is also expected to slow amid soft consumer demand and declining productivity, underscoring the uneven nature of the global recovery.
On trade, nearly half (48 per cent) of the chief economists said they foresee increased global trade volumes in 2025, highlighting resilience in global commerce.
However, the report warned of heightened trade tensions, driven by protectionism, geopolitical conflicts, sanctions, and national security concerns.
The survey revealed that 82 per cent of economists expect greater regionalisation of trade over the next three years, coupled with a gradual shift from goods to services.
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