The global growth rate is consistently decreasing from the last 3 decades, and this current decade from 2022-30 also has a potential to slowdown of about 2.2% if not taken any aggressive steps by all the nations

and policy makers, ushering in a "lost decade" for the world's economy, unless the policymakers from different nations adopt ambitious initiatives or aggressive steps to boost the labor supply, productivity and investment, the result of ambitious development agenda from 193 countries, with 169 ambitious targets  which collectively make up the 17 of the sustainable development goals (SDGs) towards 2030 will not be full filled.

Failure by the policymakers  to overcome the expected slowdown for the 2022-30 decade of gross domestic product (GDP) growth would have profound implications to tackle climate change and reduce poverty. We are at the middle of the road of the SDGs and the data shows only 12 % on track, with this progress, still 575 million people will be in poverty by the year 2030, which is not a good number. Nations needs to invest in sustainable sectors like food and agriculture, cities energies and materials, and health and well-being. Also, accelerate the investment mainly in the sustainable sectors as per the SDGs which will cut the costs, help in growth of service sector, and expand the labor force participation in urban and rural areas which could then boost the potential GDP growth at least by up to 0.7 % to 2.9% percentage point. The global trade is resilient and on the other hand it’s slowing down along with the global growth which needs to be accelerated with fast pace.

The rising of the interest rate in the banking sector is becoming the main concern, and the inflation is also needs to be taken care. If another financial crisis erupts means and if that accompanies with the global recession, it will affect more to the growth prospects for the present decade 2022-30 growth rate. The recessionary clouds are hovering around US due to banking crisis. Global growth forecast show a slowdown in 2023, and almost 1.1 billion jobs are likely to be disrupted in the coming decade because of the new trends of both opportunities and threats from jobs, geopolitics and rising inequality.

The geo-political issues from the Russia-Ukraine war to the issues in Sudan and the overlapping crisis in the present decade due to the COVID-19 pandemic had nearly ended the three decades 2020-2030 of sustained economic growth, bringing more worries about slowing productivity in agriculture, manufacturing and services, which is very essential for the income growth and higher wages. Overall the result show the average potential growth in GDP was seen dropping in the last 3 decades from 2.2% from 2022-2030, less from 2.6% in 2011-21, and nearly a lesser than the 3.5% rate seen from the first decade of this century between 2000-2010. After the Syria and Iran re-joined the Arab league, the Arab world can have a little peace and prosperity thereby can sustain the growth and also control the extreme poverty and child mortality.

High interest rates and increasing debts adding to about $800 billion effect to developing economies. Investment in developing nations is also shrinking down the growth in developing economies, with their average GDP growth dropping to the 4% for the rest of the present decade of 2020s, from 5% in 2011-2021 and 6% from 2000-2010 decade. Some countries has done well and went up to the higher income status countries as they have controlled the inflation, improved the productivity. In sum, the productivity, investment and the international trade in developing countries is at the slowest pace due to which the global growth rate is affected. The policy makers needs to prioritize the financial sector stability, reduce the debt, lower the costs associated with regulations, boot the logistics and shipping for the trade, expand the growth of digital services or e-commerce at the same time can promote the climate-friendly investments which could also add  to 0.3 % to annual potential growth, raising the labor force participation can also boost to 0.2 % of the potential growth a year by 2030.

References

Shalal, A. (2023) ‘World Bank warns of 'lost decade' in global growth without bold policy shifts’ World Economic Forum, Available from https://www.weforum.org/agenda/2023/04/

United Nations (2023) UN News, Available at: https://news.un.org/en/story/2023/04/1135552

United Nations (2023) ‘Progress towards the Sustainable Development Goals: Towards a Rescue Plan for People and Planet’, General Assembly Seventh-eighth session, Item 19 of the preliminary list Sustainable development, United Nations General Assembly Economic and Social Council, UN, NY.