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NEW YORK — United Nations economists are forecasting low growth globally this year, as recovery from the COVID-19 pandemic remains uneven internationally and wild cards such as climate shocks and geopolitical tensions could undermine progress.

The U.N.’s flagship World Economic Situation and Prospects 2024 report launched on Thursday projects global economic growth will slow from 2023’s estimated 2.7% to 2.4% this year, below the pre-pandemic growth rate of 3%.

“The better-than-expected performance for 2023 is chiefly driven by several large economies — notably the United States, but also Brazil, India and Mexico,” said Shantanu Mukherjee, director of the Economic Analysis and Policy Division at the U.N. Department of Economic and Social Affairs.

But, he said, that growth could slow this year, especially in the United States, because of high interest rates, reduced consumer spending and weaker labor markets.

“We are not out of the danger zone in terms of the general environment being fairly unsettled,” Mukherjee told reporters.

Europe also is not without economic challenges as it copes with high inflation and interest rates and the effects of Russia’s war in Ukraine. The 27-nation bloc is expected to see 1.2% gross domestic product growth this year.

“That’s a very, very modest growth rate for the region, even to catch up some of the lost output,” said Hamid Rashid, chief of the Global Economic Monitoring Branch at the U.N. Department of Economic and Social Affairs. “So we are seeing direct impact from the war.”

Lingering effects of COVID-19

Developing countries are still struggling to overcome COVID-19 setbacks while coping with high interest rates and rising debt. The economists forecast that in about a quarter of all developing countries, annual inflation is projected to exceed 10% this year.

Worldwide, inflation was forecast to be an average of 3.9% this year, down from 5.7% in 2023.

“That is a rapid change,” says Mukherjee. “Back in 2022, we were seeing 8.1%.”

In China, the U.N. report found, recovery from the pandemic was slower than expected, but the country turned a corner during the second half of 2023, with the growth rate reaching an estimated 5.3% for the year, up from 3% in 2022.

“We are more optimistic about China’s growth outlook in the near-term,” Rashid said. “The outlook is stable.”

Africa is projected to have modest economic growth, creeping up from an estimated 3.3% in 2023 to 3.5% in 2024. The economists say this will be driven mainly by countries in east and southern Africa.

East Asia is projected to see growth slow from 4.9% in 2023 to 4.6% in 2024, mainly because of a slowdown in global demand for exports.

The outlook in Latin America and the Caribbean is deteriorating.

An important factor contributing to global economic health is trade. While it didn’t contract last year, it had very little growth.

“Without global trade picking up, which has been an engine of growth for many developing countries, we will not see the return of growth that we had before the pandemic,” Rashid said.

While the economic outlook is not all gloom and doom, the experts say they will be watching several indicators to gauge economic prospects this year. They include challenges arising from monetary tightening, weakened global trade and investment, and rising debt vulnerabilities.

They say these can be compounded by heightened geopolitical risks and rapidly worsening impacts of climate change.
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KAMPALA, UGANDA — Days after the United States removed Uganda from an economic assistance program due to human rights concerns, Uganda’s president harshly criticized the West.

In a speech Thursday, President Yoweri Museveni urged lawmakers from the Commonwealth of Nations to reject what he called the evil tendencies of Western countries toward societies different from them.

Museveni told the 33 parliament speakers from Commonwealth countries meeting in Kampala that the West’s oppression takes the form of aggression, looting, enslavement, displacement, ethnic cleansing, colonization and indirect domination without occupying one’s territory.

“If you want freedom, if you value freedom, then you should value the freedom of everybody,” he said. “If you value independence, if you value dignity, then you must respect the dignity of everybody. Stop manipulations and lectures to the societies that are different from yours.”

Museveni accused “some countries” of using technological progress to hold down other countries that have different values.

“Instead of using this human progress for the benefit of all, some actors out of greed and philosophical, ideological and strategic shallowness, miscalculate and seek to monopolize knowledge and also use knowledge to oppress others,” he said.

Since Ugandan lawmakers passed an anti-homosexuality law in May 2023, the East African country has come under pressure for the abuse of human rights.

The World Bank withdrew funding from the nation, and just this week, Uganda lost its eligibility for the U.S. African Growth and Opportunity Act, or AGOA.

Through AGOA, some countries in sub-Saharan Africa, including Uganda, had duty-free access to the U.S. market for close to 6,000 products.

Asuman Basalirwa, the member of Uganda’s parliament who introduced the anti-gay legislation that has been described as the world’s harshest law against the LGBTQ community, said he is not surprised that Uganda is facing consequences.

“I am really disappointed about their preferential treatment of rights,” Basalirwa said. “And that makes them lose the moral authority to attack the country over the anti-homosexuality law.”

Regardless, he said, “nobody should tell you that the country will not suffer as a result of closure of AGOA.”

Uganda’s earnings through AGOA grew from $4 million to about $8 million in the 12 months up to June 2023.

Museveni said Uganda could still take advantage of its access to the 2.4 billion people who live in Commonwealth nations, made up mostly of former British colonies, to grow its economy.

Basalirwa said Uganda also needs to find paths to markets in East Asia and get a foothold in the U.S. market.
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BUENOS AIRES, ARGENTINA — Argentine judges on Wednesday suspended labor law changes that form part of a decree of sweeping economic reforms and deregulation announced by the country’s new libertarian president, Javier Milei.

The CGT trade union body had challenged the changes, which technically took effect last Friday, on grounds that they erode basic worker protections such as the right to strike and parental leave.

Judges of Argentina’s labor appeals chamber froze elements of Milei’s decree, which, among other things, increased the legal job probation period from three to eight months, reduced compensation in case of dismissal and cut pregnancy leave.

Judge Alejandro Sudera questioned the “necessity” and “urgency” of the decree Milei signed on December 20 — just days after taking office — and suspended the measures until they can be properly considered by Congress.

Some of the measures, Sudera added in a ruling distributed to the media, appeared to be “repressive or punitive in nature,” and it was not clear how their application would aid Milei’s objective of “creating real jobs.”

The government can appeal Wednesday’s ruling.

Thousands took to the streets last week to protest the reforms of self-proclaimed “anarcho-capitalist” Milei, who won elections in November with promises of slashing state spending as Argentina deals with an economic crisis, including triple-digit inflation.

The CGT has called a general strike for January 24.

“Rebuilding the country”

The measures have drawn heated debate among jurists about their constitutionality and are the subject of several court challenges.

When he announced his decree, Milei said the goal was to “start along the path to rebuilding the country … and start to undo the huge number of regulations that have held back and prevented economic growth.”

The decree changed or scrapped more than 350 economic regulations in a country accustomed to heavy government intervention in the market.

It eliminates a law regulating rent, envisages the privatization of state enterprises and terminates some 7,000 civil service contracts.

Latin America’s third-biggest economy is on its knees after decades of debt and financial mismanagement, with inflation surpassing 160% year-on-year and 40% of Argentines living in poverty.

Milei has pledged to curb inflation but warned that economic “shock” treatment is the only solution, and that the situation will get worse before it improves.

Won election resoundingly

The 53-year-old won a resounding election victory on a wave of fury over the country’s decades of economic crises marked by debt, rampant money printing, inflation and fiscal deficit.

Milei has targeted spending cuts equivalent to 5% of gross domestic product.

Shortly after taking office, his administration devalued Argentina’s peso by more than 50% and announced huge cuts in generous state subsidies of fuel and transport.

Milei has also announced a halt to all new public construction projects and a yearlong suspension of state advertising.

Argentines remain haunted by hyperinflation of up to 3,000% in 1989 and 1990 and a dramatic economic implosion in 2001.
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