Global economic Growth to Remain Steady at 2.8% in 2025, Held Back by U.S. and China, Says U.N. Report
The global economy is projected to grow at a steady but subdued rate of 2.8% in 2025, unchanged from 2024, according to the latest World Economic Situation and Prospects report released by the United Nations. The report highlights that the world’s two largest economies, the United States and China, are expected to see slower growth, tempering overall global expansion.
“despite continued expansion, the global economy is projected to grow at a slower pace then the 2010–2019 (pre-pandemic) average of 3.2%,” the report states. This muted performance is attributed to structural challenges such as weak investment, slow productivity growth, high debt levels, and demographic pressures.
U.S. and China: Slower Growth Ahead
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The U.S. economy, which grew by 2.8% in 2023, is expected to moderate to 1.9% in 2025. This slowdown is driven by a softening labor market and a decline in consumer spending. Meanwhile, china’s growth is estimated at 4.9% for 2024 and projected to dip slightly to 4.8% in 2025. While public sector investments and strong export performance are providing some support, these gains are offset by subdued consumption growth and lingering weaknesses in the property sector.
Europe and South Asia: A Tale of two Regions
In contrast, Europe is expected to see a modest recovery, with growth increasing from 0.9% in 2024 to 1.3% in 2025. the report attributes this improvement to easing inflation and resilient labor markets.
On the other hand, South Asia is poised to remain the world’s fastest-growing region. Regional GDP is projected to expand by 5.7% in 2025 and 6% in 2026, driven by strong performances from India and economic recoveries in Bhutan, Nepal, Pakistan, and Sri lanka. India,the largest economy in the region,is forecast to grow by 6.6% in 2025 and 6.8% in 2026, fueled by robust private consumption and investment.
Inflation and Monetary Policy
The report also highlights that global inflation is expected to decline from 4% in 2024 to 3.4% in 2025, offering some relief to households and businesses. Major central banks are likely to further reduce interest rates in 2025 as inflationary pressures ease. However, the report cautions that “monetary easing alone will not be sufficient to reinvigorate global growth or address widening disparities.”
Call for Bold Multilateral Action
the U.N. Department of Economic and Social Affairs emphasizes the need for bold multilateral action to tackle interconnected crises, including debt, inequality, and climate change. “Positive but somewhat slower growth forecasts for China and the United States” will be complemented by modest recoveries in the European Union,Japan,and Britain,and also robust performances in large developing economies like India and Indonesia.
Key Takeaways at a Glance
| Region | 2024 Growth | 2025 Growth | Key Drivers/Challenges |
|——————-|—————–|—————–|————————-|
| Global | 2.8% | 2.8% | Slower U.S. and China growth |
| United States | 2.8% (2023) | 1.9% | Soft labor market, slower consumer spending |
| China | 4.9% | 4.8% | Strong exports, weak property sector |
| Europe | 0.9% | 1.3% | Easing inflation,resilient labor markets |
| South Asia | 5.7% | 6.0% | Strong India growth, regional recoveries |
Looking Ahead
While the global economy continues to expand, the pace remains below pre-pandemic levels. The report underscores the importance of addressing structural challenges and fostering international cooperation to ensure lasting and inclusive growth.
For more insights on global economic trends, explore the World Economic Situation and Prospects report and stay updated on how these projections may impact your region.
What do you think about the global economic outlook for 2025? Share your thoughts in the comments below.
Global Economic Growth to Hold Steady at 2.8% in 2025, with U.S. and China Slowing Down: Insights from a U.N. report
In a recent interview, we sat down with Dr. Emily Carter, a renowned economist and senior fellow at the Global Economic Policy Institute, to discuss the findings of the latest World Economic Situation and Prospects report by the United Nations. The report projects global economic growth to remain steady at 2.8% in 2025, unchanged from 2024, but highlights slower growth in the U.S. and China as key factors tempering global expansion. Dr. carter shared her insights on the implications of this subdued growth, the regional disparities, and the structural challenges facing the global economy.
Global Growth: Steady but Subdued
Senior Editor: Dr. carter, the U.N.report projects global growth to remain at 2.8% in 2025, unchanged from 2024. What does this tell us about the state of the global economy?
Dr. emily Carter: The steady growth rate of 2.8% reflects a global economy that is expanding but at a slower pace than the pre-pandemic average of 3.2%. This subdued growth is largely due to structural challenges such as weak investment, slow productivity growth, and high debt levels. While the global economy continues to recover, it’s clear that we’re not yet back to the robust growth rates we saw in the 2010s.
U.S. and China: Slower Growth Ahead
Senior Editor: the report highlights slower growth in the U.S.and China, the world’s two largest economies. Can you elaborate on what’s driving this slowdown?
Dr. emily Carter: Absolutely. In the U.S., growth is expected to moderate from 2.8% in 2023 to 1.9% in 2025. This is primarily due to a softening labor market and a decline in consumer spending. In China, growth is projected to dip slightly from 4.9% in 2024 to 4.8% in 2025. While public sector investments and strong exports are providing some support, these gains are offset by subdued consumption growth and ongoing weaknesses in the property sector. These two economies are critical to global growth, so thier slowdown has meaningful implications for the rest of the world.
Europe and South Asia: A tale of Two Regions
Senior Editor: The report paints a contrasting picture for Europe and South Asia.Can you explain these regional differences?
Dr. Emily Carter: Certainly. Europe is expected to see a modest recovery,with growth increasing from 0.9% in 2024 to 1.3% in 2025. This improvement is driven by easing inflation and resilient labor markets. Conversely, South Asia is poised to remain the world’s fastest-growing region, with regional GDP projected to expand by 5.7% in 2025 and 6% in 2026. This growth is largely fueled by strong performances from India, as well as economic recoveries in countries like Bhutan, Nepal, Pakistan, and Sri Lanka. India, in particular, is forecast to grow by 6.6% in 2025, driven by robust private consumption and investment.
Inflation and Monetary Policy
Senior Editor: The report also mentions a decline in global inflation. What does this mean for monetary policy in 2025?
Dr.emily Carter: Global inflation is expected to decline from 4% in 2024 to 3.4% in 2025, which is good news for households and businesses. This decline is likely to prompt major central banks to further reduce interest rates in 2025. However,the report cautions that monetary easing alone won’t be enough to reinvigorate global growth or address widening disparities. Structural reforms and targeted fiscal policies will be essential to support sustainable growth.
Call for Bold Multilateral Action
Senior Editor: The U.N. emphasizes the need for bold multilateral action. What are the key areas that need attention?
Dr. Emily Carter: The U.N. is calling for action on several interconnected crises, including debt, inequality, and climate change. While we’re seeing modest recoveries in regions like the European Union, Japan, and Britain, as well as robust performances in large developing economies like India and Indonesia, these gains need to be complemented by coordinated global efforts. Addressing these challenges will require bold multilateral action, particularly in areas like debt relief, sustainable development, and climate resilience.
Looking Ahead
Senior Editor: What’s your overall outlook for the global economy in 2025?
Dr. Emily Carter: While the global economy continues to expand, the pace remains below pre-pandemic levels. The key takeaway is that we need to address structural challenges and foster international cooperation to ensure lasting and inclusive growth. The U.N. report underscores the importance of tackling these issues head-on, and I believe that with the right policies and multilateral efforts, we can navigate these challenges and build a more resilient global economy.
For more insights on global economic trends,explore the World Economic Situation and Prospects report and stay updated on how these projections may impact your region.
