The Davos gurus foresee a weakening in 2024 of the world economic system, particularly the European one, which is able to have an effect on the inventory markets | EUROtoday

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The financial gurus of Davos foresee a weakening of the worldwide economic system in 2024, and significantly in Europe, as a result of enhance in numerous issues, together with geopolitical ones, which is able to have an effect on progress and markets. This is mirrored within the newest report from the World Economic Forum ready after a survey of chief economists from private and non-private establishments all over the world, together with Banco Santander and BBVA.

“The uncertainty that dominated the economic outlook last year will continue to obscure short-term economic developments”, the report states. “56% of chief economists expect the world economy to weaken next year” and the proportion will increase to 77% when requested in regards to the European economic system.

“While there have been positive developments, such as the easing of inflationary pressures and advances in the field of artificial intelligence (AI), companies and policymakers face continued volatility as financing conditions remain tight. restrictive and geopolitical differences and social tensions increase”.

There isn’t any clear financial engine in sight, as a result of the Chinese economic system is failing. “China remains an exception to the growth outlook in much of Asia and the outlook weakens in the US, Middle East and North Africa.

About seven in ten chief economists predict that the pace of geoeconomic fragmentation will accelerate this year, reversing the globalization of the past decade. And the majority say that geopolitics will drive volatility in the global economy (87%) and stock markets (80%). Fragmentation is advancing and 80% maintain that the geoeconomic blocks will be reinforced and that the North-South gap will widen over the next three years.

There is also pessimism with industrial policy, because, although governments around the world agree on trying to relaunch it, experts are almost unanimous that the measures will remain largely uncoordinated between countries. Although two-thirds of chief economists expect industrial policies to enable new pockets of economic growth and vital new industries, the majority also warn of increasing budget tensions (79%) and divergence between income economies high and low (66%).

On Artificial Intelligence, chief economists expect that the benefits of AI will vary widely between different groups of countries based on their income. A large majority say AI will increase production efficiency (79%) and innovation (74%) in high-income economies this year. Looking ahead to the next five years, 94% expect these productivity benefits to be economically significant in high-income economies, compared to only 53% in low-income economies.

Almost three quarters (73%) do not foresee a net positive impact on employment in low-income economies. In contrast, only 47% said the same for high-income economies.