Economic Forecasts from the World's Leading Economists

Global economic growth is seen slowing marginally in 2020

Global economic growth is seen slowing marginally next year on weaker momentum in the G7 and China, which will only be partially offset by stronger growth in other emerging markets. Rising global trade protectionism is the key downside risk to the outlook, which primarily centers around the evolution of the U.S.-China trade dispute. 

Next year’s growth prospects for Latin America were slashed for the fifth month running in December, with regional activity seen modestly picking up mainly on strengthening momentum in Brazil and Mexico. Argentina is poised to remain in recession for the third consecutive year. Heightened social tensions, policy uncertainty and tepid global demand cloud the outlook.

Growth is seen slowing slightly next year as a loss of momentum in the Dominican Republic and Puerto Rico will outweigh faster growth in Costa Rica and Panama. Downside risks stem from potential social unrest—particularly in Haiti, Honduras and Nicaragua—and a vulnerability to natural disasters. 

Economic growth in ASEAN is projected to gather momentum in 2020, propelled by more accommodative monetary stances, fiscal stimulus and solid domestic economies. Nevertheless, the prolonged U.S.-China trade rift and a sharper-than-expected downturn in China could hinder growth prospects, particularly given the region’s reliance on trade and the tech sector.

East Asian economies are expected to decelerate in 2020

The East Asian economy is seen further decelerating next year as export-driven economies continue to face headwinds from China-U.S. trade tensions, which are weighing on global economic activity. More supportive fiscal and monetary policies should, however, support growth.

The economy should continue to expand modestly modest in 2020, following a notable deceleration this year. 

Growth held steady in the third quarter, reflecting stable economic performances in the region’s big players. That said, the pace of expansion was modest overall, as the economy was restrained by persistent external headwinds, a weak industrial sector and a cooling labor market. Turning to the fourth quarter, survey-based indicators point to another quarter of sluggish growth. In October, the composite PMI ticked up, although it landed barely above the crucial 50-point threshold. Moreover, economic sentiment plunged to a near five-year low, owing to a broad-based decline in confidence among consumers and businesses. Meanwhile, in the political arena, elections in Spain produced a deeply fragmented Parliament; although the ruling Socialist party struck a deal with far-left Podemos, they still have to find enough support in Parliament and, even if a new government was sworn in, lawmaking would likely be bumpy. Growth is seen at 1.0% in 2020, which is down 0.1 percentage points from last month’s forecast. In 2021, GDP is seen increasing 1.3%.

Central & Eastern Europe growth to lose steam in 2020

In 2020, the regional economy should lose some steam, amid an uncertain global backdrop, slowing activity in the Eurozone and growing supply constraints. Cooling labor markets will constrain consumer spending growth, which will nevertheless remain resilient on solid wage increases, while moderating construction activity and EU funding inflows will restrain fixed investment.

Regional economic activity is expected to accelerate notably next year

Regional economic growth should gain speed next year, mostly due to a rebound in the Turkish economy. External headwinds will continue to cloud the outlook for the region, chiefly owing to global trade tensions and subdued growth in the EU; however, still-accommodative monetary policies, tight labor markets and solid wage gains should keep domestic demand resilient.

Regional growth is seen picking up next year

Regional growth is seen picking up next year, chiefly on firmer domestic demand in Russia amid fiscal stimulus and persistent monetary policy easing. Accelerating economic activity in Belarus, coupled with upbeat growth momentum in Azerbaijan, Kazakhstan and Ukraine, should cement the upturn. A volatile external environment remains a major risk to the outlook, however.

Economic growth is set to accelerate notably in 2020 

Although economic growth is projected to gain steam next year, risks to the economic outlook are skewed to the downside. Particularly, if OPEC+ decides to extend the oil cut deal at the December meeting, this would limit the expected recovery among those countries dependent on oil exports. Moreover, rising domestic political unrest could hit regional growth in 2020.

Available data points to a downturn in the third quarter following the second quarter’s upswing, as a series of breakdowns in Eskom’s coal power plants triggered a burst of rolling blackouts. Consequently, electricity supply swung to contraction in the quarter, as the debt-ridden state-owned utility struggles to stay afloat, hampering overall activity. Moreover, manufacturing production and business confidence both fell in Q3, while retail sales growth slowed in the first two months of the quarter. On 1 November, Moody’s opted to uphold its rating on the country’s sovereign debt rather than downgrade to junk, despite the medium-term budget policy statement released on 30 October revealing a bleak fiscal picture ahead. The outlook, however, was cut from stable to negative, underlining the material risk that the government will likely fail to restore fiscal discipline, especially given an apparent lack of political capital to implement tough reforms. This suggests that the country is unlikely to retain its final investment-grade rating in the medium-term; a downgrade to junk would trigger sizeable capital outflows.