UN:Improved Prospects for World Economy05/17 06:24

   The United Nations reported improved prospects for the world economy since 
its January forecast on Thursday, pointing to a better outlook in the United 
States and several large emerging economies including Brazil, India and Russia.

   UNITED NATIONS (AP) -- The United Nations reported improved prospects for 
the world economy since its January forecast on Thursday, pointing to a better 
outlook in the United States and several large emerging economies including 
Brazil, India and Russia.

   According to its mid-2024 report, the world economy is now projected to grow 
by 2.7% this year -- up from the 2.4% forecast in its January report -- and by 
2.8% in 2025. A 2.7% growth rate would equal growth in 2023, but still be lower 
than the 3% growth rate before the COVID-19 pandemic began in 2020.

   "Our prognosis is one of guarded optimism, but with important caveats," 
Shantanu Mukherjee, director of the U.N.'s Economic Analysis and Policy 
Division, told a news conference launching the report.

   The report pointed to interest rates that are higher for longer periods, 
debt repayment challenges, continuing geopolitical tensions and climate risks 
especially for the world's poorest countries and small island nations.

   Mukherjee said inflation, which is down from its 2023 peak, is both "a 
symptom of the underlying fragility" of the global economy where it still 
lurks, "but also a cause for concern in its own right."

   "We've seen that in some countries inflation continues to be high," he said. 
"Globally, energy and food prices are inching upward in recent months, but I 
think a bit more insidious even is the persistence of inflation above the 2% 
central bank target in many developed countries."

   The U.N. forecast for 2024 is lower than those of both the International 
Monetary Fund and the Organization for Economic Cooperation and Development.

   In mid-April, the IMF forecast that the world economy would continue growing 
at 3.2% during 2024 and 2025, the same pace as in 2023. And the OECD in early 
May forecast 3.1% growth in 2024 and 3.2% in 2025.,

   The latest U.N. estimates foresee 2.3% growth in the United States in 2024, 
up from 1.4% forecast at the start of the year, and a small increase for China 
from 4.7% in January to 4.8%. for the year.

   Despite climate risks, the report by the U.N. Department of Economic and 
Social Affairs forecasts improved economic growth from 2.4% in 2023 to 3.3% in 
2024 for the small developing island nations primary due to a rebound in 
tourism.

   On a negative note, the report projects that economic growth in Africa will 
be 3.3%, down from 3.5% forecast at the beginning of 2024. It cited weak 
prospects in the continent's largest economies -- Egypt, Nigeria and South 
Africa -- along with seven African countries "in debt distress" and 13 others 
at "high risk of debt distress."

   Mukherjee said the lower forecast for Africa "is particularly worrying 
because Africa is home to about 430 million (people) living in extreme poverty 
and close to 40% share of the global undernourished population" and "two-thirds 
of the high inflation countries listed in our update are also in Africa."

   For developing countries, he said, the situation isn't "as dire" but an 
important concern is the continuing fall and sharp decline in investment growth.