The "Global Economic Situation and Prospects Mid-Year Update 2025" is a report released by the United Nations on May 15, 2025. The report predicts that global economic growth will slow to 2.4% in 2025 from 2.9% in 2024, primarily due to increased tariffs and trade policy uncertainty exacerbating supply chain pressures, leading to a decline in business investment. Global trade growth is expected to plummet from 3.3% in 2024 to 1.6% in 2025, with merchandise trade likely to contract in the second half of the year, but digitalization will drive resilience in services trade. Developing countries face multiple challenges, including reduced exports, declining commodity prices, tighter financing conditions, and increased debt burdens. Weak global growth further hinders the achievement of Sustainable Development Goals and limits investment in the green transition. Global inflation is expected to be 3.6%, with supply chain disruptions and climate change pushing up prices. The job market is undergoing structural adjustments due to the economic slowdown, and the rapid adoption of generative artificial intelligence may bring about a new round of employment structure changes. Investment and financial markets are volatile due to escalating trade frictions, threatening the financing capabilities of developing countries. The report recommends a comprehensive approach using a combination of monetary, fiscal, supply-side, and industrial policies to address challenges, and emphasizes the crucial role of policy coordination and international cooperation in stabilizing the global economy.
Industry Development Trends
Core Drivers of Emerging Industries
Emerging industries such as the digital economy and green economy are gradually becoming core drivers of economic growth. The rapid development of the digital economy has not only promoted the digital transformation of traditional industries but also spawned numerous new business formats and models, such as e-commerce, the sharing economy, and intelligent manufacturing. The green economy has also developed rapidly against the backdrop of global climate change response. Innovation and industrialization in areas such as new energy, energy conservation and environmental protection, and green building have provided new impetus for sustainable economic development.
Transformation of Traditional Industries
The digital and green transformation of traditional industries is also deepening. By introducing advanced digital and green technologies, traditional industries can achieve improved production efficiency, optimized resource allocation, and reduced environmental impact. For example, through intelligent transformation, manufacturing can achieve automation and intelligence in production processes, improving product quality and production efficiency. Simultaneously, by adopting clean energy and circular economy models, traditional industries can achieve green production and reduce their environmental impact.
Industrial Integration and Innovation
Industrial integration and innovation are becoming increasingly frequent. The cross-industry convergence has given rise to many new industrial forms and business models. For example, the integration of information technology and manufacturing has driven the development of intelligent manufacturing; the integration of finance and technology has given rise to the emerging field of fintech. This integration and innovation not only promotes industrial upgrading and transformation but also provides new impetus for sustained economic growth.
Different Economic Growth Prospects Across Regions
Due to a weak labor market and slowing consumer spending, US economic growth is projected to slow from 2.8% in 2024 to 1.9% in 2025. The European economy is expected to recover moderately, primarily due to easing inflation and a resilient labor market, but long-term challenges such as fiscal austerity, weak productivity growth, and an aging population will continue to weigh on the economic outlook.
East Asian economic growth is projected to reach 4.7% in 2025, driven by strong private consumption in the region, with China expected to achieve stable growth at 4.8%. South Asia is expected to remain the fastest-growing region.
Africa's growth is projected to rise slightly from 3.4% in 2024 to 3.7% in 2025, primarily driven by the recovery of major economies such as Egypt, Nigeria, and South Africa. However, conflict, rising debt servicing costs, job losses, and the intensifying impacts of climate change are all weighing on Africa's economic outlook.
Threats from Heavy Debt Burdens and Rising Food Inflation
While the easing of global financial conditions has helped lower borrowing costs for developing economies, access to capital remains uneven. Many low-income countries still face heavy debt servicing burdens and limited access to international financing. The report emphasizes that governments should seize the fiscal space created by loose monetary policies to prioritize investments in sustainable development, particularly in key social sectors. Despite some easing of global inflation, food inflation remains high, with nearly half of developing countries experiencing food inflation exceeding 5% in 2024. This exacerbates food insecurity in low-income countries already facing challenges from extreme weather events, conflict, and economic instability.
Critical Minerals: A Significant Opportunity to Accelerate Sustainable Development
The report highlights the potential of critical minerals, such as lithium, cobalt, and rare earth elements, in the energy transition, and their potential to accelerate the achievement of Sustainable Development Goals in many countries.
For resource-rich developing countries, the growing global demand for critical minerals presents a unique opportunity to promote growth, create jobs, and increase public revenue for sustainable development investments. However, the report warns that poor governance, unsafe labor practices, environmental degradation, and over-reliance on volatile commodity markets could exacerbate inequality and damage ecosystems, thereby undermining long-term development gains.
A Call for Bold Multilateral Action
The report calls for bold multilateral action to address the interconnected crises of debt, inequality, and climate change. It emphasizes that governments must avoid overly restrictive fiscal policies and instead focus on mobilizing investment in clean energy, infrastructure, and key social sectors such as health and education.
The report notes that strengthened international cooperation is also crucial for managing the environmental, social, and economic risks associated with critical minerals. Harmonious sustainability standards, fair trade practices, and technology transfer are needed to ensure that developing countries can use these resources responsibly and equitably.
