Abu dhabi: As the growth strategies that powered the global economy over the past three decades lose relevance, a new World Economic Forum (WEF) report calls for a renewed blueprint to navigate a rapidly evolving landscape shaped by AI, geostrategic competition, rising debt and inequality, and mounting environmental and demographic pressures. The report draws on two years of dialogue with nearly 200 global business leaders, policy-makers and experts, and a survey of more than 11,000 executives worldwide.
According to Emirates News Agency, the WEF report, "Growth in the New Economy: Towards a Blueprint," identifies key 'no-regret' strategies and open dilemmas for governments and businesses that will define economic policy in the coming decade. The report focuses on four major areas: technology, productivity and human capital; global cooperation and domestic capacity; business environment and the role of government; and sustainability and economic policy.
The report emphasizes the need for bold choices and trade-offs from both governments and businesses. 'Investing in productivity, talent and reinforcing the fundamentals of economic policy are clear winning strategies that hold across every country and income level,' said Attilio Di Battista, Head of Economic Growth and Transformation at the World Economic Forum. Leaders are urged to navigate complex dilemmas while managing record levels of debt and inequalities, rising geostrategic competition, a persisting climate crisis, and the fastest technological shift in a generation.
Amid disruptions brought by the current conflict in the Middle East, the report highlights long-term shifts in the composition and drivers of economic growth. Middle-income economies are expected to account for nearly two-thirds of global GDP growth through 2030, with Asia continuing to be the main driver, accounting for more than 50% of global growth. Despite the fastest growth rates, low-income economies are projected to contribute just 1% of global growth over the same period.
Information technology services, advanced manufacturing, health and healthcare, and accommodation and leisure sectors are expected to drive growth over the next five years, with Asia, Europe and North America identified as key hotspots. Additionally, Latin America and the Caribbean will see opportunities in the agriculture, mining and metals sectors.
The report also highlights high energy costs and policy instability as the two primary barriers constraining the acceleration of economic growth across various geographies and income levels. Other barriers vary by country income level, with skill shortages and rigid regulations noted in high-income economies, while limited access to finance and inadequate infrastructure were top concerns in low-income economies.
In the long-term, frontier technologies and the green and energy transition are identified as trends that will drive growth and investment, whereas high debt, societal polarization, and climate change are seen as potential headwinds across regions and income levels.