According to the World Bank’s Global Economic Prospects report, global growth is projected to slow from 3.1% in 2022 to 2.1% in 2023, with emerging market and developing economies (EMDEs) facing financial risks due to elevated global interest rates.
The report indicates that one out of every four EMDEs has effectively lost access to international bond markets, and growth projections for these economies for 2023 are less than half those from a year ago, making them highly vulnerable to additional shocks. The report also notes that low-income countries will see per capita incomes in 2024 still below 2019 levels.
Growth in the East Asia and Pacific (EAP) area is rebounding after a significant dip in 2022, aided by robust activity in China following the reopening of its economy and a quick drop in COVID-19 infections. Early in 2023, China’s economy had a robust recovery, supported by the release of stalled demand that increased consumption.
The EAP region’s GDP is predicted to accelerate to 5.5% in 2023, with a comeback in China balancing sluggish growth in a number of other economies. Growth in the EAP is predicted to drop to 4.6% and 4.5% in 2024 and 2025, respectively, as China’s economy slows and the rest of the region experiences largely stable growth.