Global GDP will grow only 2.8% in 2010, predicts IHS Global Insight. This is much better than the 2.0% drop in 2009, but well below the 3.5-4.0% trend rate of growth for the world economy. Most emerging markets, particularly Asia, will outpace the developed economies in 2010, the company predicts.
The forecaster's top 3 economic predictions for 2010 are:
- The US recovery will start slowly. IHS expects US growth to be in the 2.0-2.5% range for most of 2010. Housing and capital spending on equipment are expected to show respectable gains, but consumer spending will rise just 1.8%.
- Europe and Japan will rebound even more slowly than the USA. Europe and Japan suffered deeper recessions than the USA and are likely to see more modest recoveries. The Eurozone and UK economies are expected to grow 0.9% and 0.8% respectively in 2010. Some Western European economies – Iceland, Ireland and Spain – will continue to contract next year. Japan will do better, with GDP growth of 1.4%.
- Most emerging markets – especially in Asia – will outpace the developed economies. Growth in all the emerging regions will recover in 2010 and, with the possible exception of Emerging Europe, will outpace the USA, Europe, and Japan. Non-Japan Asia will be at the forefront, with GDP growth of 7.1%. Latin America, the Middle East and Africa will see gains in the 3-4% range. Emerging Europe will expand only 1.7%.
Video clip: Nariman Behravesh releases IHS Global Insight's Top 10 Economic Predictions for 2010.
