OECD increases expected global economic upswing for 2024 amid fears of conflict

(MENAFN) In a recent update, the Organization for Economic Cooperation and Development (OECD) revised its projection for global economic growth in 2024, anticipating a rate of 2.9 percent, up from its previous forecast of 2.7 percent made in November. This upward adjustment was largely driven by heightened expectations for the United States, the world's largest economy. The OECD acknowledged the unexpectedly robust growth experienced in 2023, which reached 3.1 percent, attributed to a combination of factors including declining inflation and strong economic performance in the United States and emerging markets, offsetting slowdowns in European countries.

However, the OECD also cautioned against potential challenges ahead, noting indicators suggesting a moderation in growth. Factors such as elevated interest rates impacting lending and real estate markets, coupled with continued weakness in global trade, are expected to exert pressure on economic expansion. Despite inflation showing signs of easing in major economies, the OECD remained cautious, stating that it is premature to conclude that underlying price pressures have been entirely contained.

Of significant concern to the OECD is the ongoing conflict in the Middle East, particularly the tensions between Israel and Hamas in Gaza, as well as attacks on ships in the Red Sea by Houthi rebels, purportedly in solidarity with Palestinians. The disruption to navigation in the Red Sea poses a potential threat to global trade and could result in increased prices for consumer goods, adding further complexity to the economic outlook. The OECD's update underscores the delicate balance between positive economic indicators and geopolitical risks, highlighting the need for continued vigilance and international cooperation to safeguard global economic stability.

MENAFN06022024000045015682ID1107814747