This term appeared frequently in headlines of prominent publications over the past year. This post looks at global growth in 2018 to see what this upswing is all about.
We used the International Monetary Fund’s April 2018 World Economic Outlook data, which serves as the basis for our C-GIDD projections. This analysis compares expected GDP per capita growth in 2018 to the 1977 – 2017 average.
The graph below projects global growth at 2.8% in 2018, a full percentage point above its average of 1.7%. We anticipate global growth to be marginally (0.1%) better than in 2017. 2018 ranks as the 7th strongest year over the past 40 years.
What is remarkable is the extent to which countries are outperforming their average growth rates. Of the 29 largest economies in the world, 20 are outperforming their 40-year growth averages. On the graph below, two countries stand out as exceptional performers relative to their averages: Iran and the Philippines.
If the global growth is really on an upswing, we would expect to see strong performances in medium and small economies, not solely large economies. The interactive pivot table below gives the full set of economies. In total, 70% of medium economies and 65% of small economies are outperforming their respective 40-year growth averages. While these percentages are welcome, some countries still see negative GDP growth rates this year and remain left out of the growth upswing.
It is unknown how long this period of high global growth will last. This year, the IMF encouraged countries to “repair the roof while the sun is shining.”*
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* Lagarde, Christine. “Opening Remarks for the World Economic Outlook Update Press Conference.”