Let’s start with the good news: Last year, the global economy defied expectations in potentially history-making ways. Amid wretched conditions—wars, surging inflation, and the biggest interest-rate surge in 40 years—the global economy did not suffer a significant downturn. It merely slowed. This was an unfamiliar plotline: It implies the world economy has grown more resilient in ways we might not yet fully understand.

Yet it would be a mistake to think the danger has passed. The World Bank’s latest “Global Economic Prospects” report predicts that global growth will slow to 2.4% in 2024 before edging up to 2.7% in 2025 (Figure 1.A). That might be a reason to cheer—if avoiding another global recession is all you care about. It could be cold comfort for nearly everyone else. Our forecasts imply that global growth remains far short of the strength needed to achieve the Sustainable Development Goals by the end of this decade. In fact, the first half of the 2020s is already proving to be the weakest half-decade of growth the global economy has registered in at least 30 years.

For now, our near-term forecasts suggest a “soft landing” is becoming increasingly likely. But watch out for wind shear. There are at least five major risks that could threaten the global economy if they materialize:

  1. Rising geopolitical tensions
  2. China’s economic slowdown
  3. Surging financial stress
  4. Trade fragmentation
  5. Climate change

Read the full article about risks for the global economy by Indermit Gill and M. Ayhan Kose at Brookings.