The Croatian economy is expected to grow by 1.9 percent in 2023, the World Bank projected on Tuesday, more than doubling its estimate, while the eurozone is expected to balance on the brink of stagnation due to tightened monetary policy and energy prices. In January, the bank forecasted a growth of 0.8 percent for the Croatian economy this year.
In the following year, growth is expected to accelerate strongly to 3.1 percent, according to the World Bank’s latest report, confirming the January forecast. In 2025, it is expected to stabilize above the three percent level and reach 3.3 percent, the report shows.
Among EU countries in the Europe and Central Asia region, the Romanian economy is expected to grow the strongest this year, by 2.6 percent, according to the bank’s estimates.
Close to Croatia in the projected growth rate this year is Bulgaria, where activity is expected to increase by 1.5 percent. Meanwhile, the Hungarian and Polish economies are expected to grow the weakest in that group, by 0.6 and 0.7 percent, respectively.
Monetary Brake
In the eurozone, activity is expected to grow by 0.4 percent this year, the World Bank calculated, raising its estimate from January by 0.4 percentage points.
The sharp slowdown in growth this year, following an estimated 3.5 percent jump in 2022, is a result of tightened monetary policy and the delayed impact of higher energy prices, the World Bank emphasizes.
The estimate for this year has been slightly raised as the economy in the eurozone benefited from a mild winter and lower gas prices at the beginning of the year.
In 2024, the economy is expected to accelerate, with a projected growth rate of 1.3 percent, thanks to reforms and investments that will be financed from the European pandemic fund, according to the World Bank.
The forecast for the following year has been lowered by 0.3 percentage points, partly due to the assessment that the tightened monetary policy will impact the economy for a longer period than previously expected by the World Bank.
In 2025, activity in the eurozone is expected to accelerate significantly, with a projected growth rate of 2.3 percent.
The US economy is expected to grow by 1.1 percent this year, and in 2024, growth is expected to slow to 0.8 percent, which the World Bank explains by the impact of raised interest rates on consumption.
For 2025, the World Bank forecasts a recovery for the world’s largest economy, with a growth rate of 2.3 percent, predicting a easing of inflation and a milder impact of higher borrowing costs.
Chinese GDP is expected to grow by 5.6 percent
In the group of developed economies as a whole, growth is expected to slow to only 0.7 percent this year, down from 2.7 percent in 2022, while in the group of emerging and developing economies, it is expected to remain at last year’s level of 4.0 percent.
The Chinese economy is expected to grow by 5.6 percent this year, the World Bank calculated, raising its estimate from January by 1.3 percentage points. In 2024, growth is expected to slow to 4.6 percent as weaker consumption outweighs a slight acceleration in exports.
Stronger growth is expected in both this year and next year in the Indian economy, at 6.3 and 6.4 percent, respectively.
The global economy as a whole is expected to grow by 2.1 percent, which is 0.4 percentage points higher than the bank projected in January. However, the forecast for the following year has been lowered by 0.3 percentage points to 2.4 percent.
