The International Monetary Fund (IMF) has projected that the world’s 20 largest economies will face their weakest medium-term growth outlook since the 2009 global financial crisis, with expansion expected to reach just 2.9% by 2030.
This forecast, detailed in a report to the Group of 20 (G20), highlights significant headwinds, including increasing protectionism and policy uncertainty.
The IMF projects that advanced G20 economies, including the U.S., Australia, the UK, and Canada, will grow only 1.4% by 2030. Meanwhile, emerging G20 markets like China and India are forecast to expand at 3.9%.
Overall, G20 economic output is expected to reach 3.2% in 2025, down from 3.3% the previous year, and further dip to 3.0% in 2026.
Trade tensions and inflation concerns
The report comes as G20 leaders prepare to convene in South Africa, though notably without the participation of key figures such as the presidents of the United States and China.
Such a gathering occurs amidst heightened global trade tensions and the implementation of increased tariffs, particularly by the U.S., aimed at bolstering domestic manufacturing.
While global inflation is generally declining, the IMF anticipates headline inflation in G20 countries to average around 3.5% in 2025.
The global lender cautioned that rising tariffs could counteract disinflationary trends, citing early indicators of increasing producer prices in the United States.
In addition, U.S. core inflation is not expected to revert to the Federal Reserve’s 2% target until 2027, a delay from previous projections.
Call for international cooperation
The IMF has implored G20 nations to promote greater collaboration, reduce trade uncertainties, and implement clear, predictable policy frameworks.
The organization specifically advised against trade pacts that include limitations or mandated purchase quotas, as these could disrupt fair competition and hinder future economic expansion.
Greater coordination among nations could help stabilize global markets and support long-term growth.
