By Staff
Friday, May 10, 2024 4:01 PM
The global economy saw steady growth in early 2024, according to a
new report from the Organization for Economic Cooperation and Development (OECD). The report projected a 3.1 percent growth in gross domestic product (GDP) in 2024, on par with 2023 figures. The OECD forecasts additional growth in 2025 of 3.2 percent as global economic pressures subside.
According to a statement from the OECD, recent fluctuations in the housing and credit markets have put significant pressure on GDP growth, however, the organization, which works collaboratively to develop policy standards to promote sustainable economic growth among member countries, said the decline in inflation and improvements in private sector confidence will continue to have a positive effect on global economies.
In February, the OECD member unemployment rate stood at 4.9 percent, close to its lowest level since 2001. OECD members include 38 countries from across the globe including the United States, Austria, Australia, Belgium, Canada, Chile, Colombia, Costa Rica and Israel.
Several factors will continue to challenge positive growth as the globe continues to emerge from the effects of the pandemic and recent global conflict and supply chain issues. The OECD reports that inflation will stay higher for longer if interest rates do not improve at a steady pace. Growth is also expected to be stagnant in China, where persistent weakness in property markets and smaller-than-anticipated fiscal supports continue to slow economic improvement.
During times of slow growth, the OECD noted governments face rising fiscal challenges given high debt levels and sizable additional spending pressures from population aging, climate adaptation and mitigation. The organization suggests that future debt burdens are likely to rise significantly if no action is taken, adding there remains a need for stronger near-term efforts to contain spending growth, improve public spending efficiency, reallocate spending to areas that better support opportunities and growth, and optimize tax revenues.