The global economy in 2024 is set to be shaped by several key trends. These trends, which range from economic growth rates and oil demand to defense spending and the impact of artificial intelligence (AI), will have significant implications for businesses, governments, and individuals alike.
Economic growth
The global economy is expected to slow down to 2.9% in 2024. This slowdown is attributed to a combination of factors including geopolitical tensions, armed conflicts, rising inflation (up to 5.8%), decreasing demand for loans due to higher interest rates, and declining business and consumer confidence.
Oil demand
The demand for oil is projected to decrease due to weakening economic activity worldwide. This trend is further influenced by the rapidly growing electric vehicle market, which is reducing the reliance on oil.
Defense spending
In response to ongoing armed conflicts, countries are expected to increase their defense spending. A notable example is the U.S., which has adopted a record defense budget of $886.3bn for the fiscal year 2024.
Artificial Intelligence
AI is set to become the backbone of business in 2024, playing a critical role in shaping and optimizing operations across all sectors of the economy. However, the integration of AI into various spheres of life also poses challenges. The OECD warns that about 27% of all jobs globally are in “high-risk” occupations due to AI developments.
Tourism
Despite the deteriorating geopolitical situation worldwide, tourism is expected to remain one of the main income sources for the world’s economies. According to the World Tourism Organization, global spending on international travel will reach $1.4tn by the end of 2023, which will be 93% of the pre-pandemic 2019 level. Furthermore, air traffic is not only expected to return to pre-pandemic values but also to exceed them.
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