The Global Risks Report 2024

Economic uncertainty 1.5 Severity score: Economic downturn FIGURE 1.14 Source World Economic Forum Global RisksPerception Survey 2023-2024.Rank: 9thNear-zero or slow global growth lasting for several years or a global contraction (recession or depression). 3%Average: 4.1 Proportion of respondents NoteSeverity was assessed on a 1-7 Likert scale[1 – Low severity, 7 – High severity]. The percentages in the graph may not add up to 100% because figures havebeen rounded up/down.6% 12% 20% 23% 23% 13% 2 years 7 High Low 6 5 4 3 2 1Severity – The near -term outlook remains highly uncertain due to domestic factors in some of the world's largest markets as well as geopolitical developments. – Continued supply-side pr essures and demand uncertainty could contribute to persistent inflation and high interest rates. – Small- and medium-sized companies and heavily indebted countries will be particularly exposed to slowing gr owth amid elevated interest rates. Global recessions occurred in 2009 and 2020Risk categories Economic Environmental Geopolitical Societal TechnologicalInterest over time406080100Lehman Brothers collapse 0 COVID-19 declared a pandemicRussia invadesUkraine 20 Year2004 2010 2015 Nov 20242020Google search for 'Recession' FIGURE 1.15 Source Google, 2023.According to one narrative, the global economy has shown surprising resilience in the face of the most aggressive global tightening of monetary policy in decades. Despite widespread predictions of a recession in 2023 (Figure 1.15), 46 the perception of a ‘softer landing’ appears to be prevailing. Inflation is falling amid tight labour markets and stronger-than-anticipated consumer spending and growth, particularly in the United States. 47 In another version, persistently elevated inflation in many countries and high interest rates are weighing heavily on economic growth, particularly in export- and manufacturing-led markets. An already visible economic downturn is likely to spread, with a risk that new economic shocks would be unmanageable in such fragility and debt passes the tipping point of sustainability. Global Risks Report 2024 27