Global Economic Growth Projected at 2.8% for 2025, UN Reports
The United Nations has projected global economic growth to remain modest at 2.8% in 2025, consistent with the growth rate for 2024, according to the latest World Economic Situation and Prospects report. This stability comes amidst ongoing structural challenges and a slowdown in major economies, particularly the United States and China.
U.S. economic growth is expected to decelerate from 2.8% in 2024 to 1.9% in 2025, driven by a softening labor market and declining consumer spending. While robust employment levels provide some stability, tightened monetary policy by the Federal Reserve has increased borrowing costs, posing risks to economic momentum.
China, the second-largest economy, is forecast to grow at 4.8% in 2025, down slightly from 4.9% in 2024. Public sector investments and strong export performance are key contributors, but subdued domestic consumption and challenges in the property sector remain significant hurdles.
In contrast, South Asia is projected to be the fastest-growing region, with GDP growth expected at 5.7% in 2025, led by India’s anticipated 6.6% expansion. Factors such as government-led infrastructure projects and a burgeoning middle class are driving this growth.
The European Union is expected to see a modest recovery, with growth rising from 0.9% in 2024 to 1.3% in 2025, supported by easing inflation and resilient labor markets.
Global inflation is projected to decline from 4% in 2024 to 3.4% in 2025, providing relief to households and businesses. However, high debt levels and demographic pressures remain significant challenges. The UN emphasizes the need for bold multilateral action to address interconnected crises, including debt sustainability, inequality, and climate change, to foster a more sustainable and equitable global economy. The report warns that many developing countries will face ongoing challenges, including high food inflation and limited access to capital.
