UN Report Projects 2026 Global Economic Growth at 2.7%, Cites Trade Tensions and High Debt as Major Drags

The United Nations Department of Economic and Social Affairs launched its flagship World Economic Situation and Prospects 2026 report on January 8, 2026. It projects that global economic output will grow by 2.7% in 2026, slightly down from an estimated 2.8% in 2025 and remains well below the pre-pandemic average of 3.2%. While the global economy has shown resilience amidst receding inflation, the report cautions that trade policy uncertainty, elevated tariffs, and persistently high public debt are severely constraining the growth outlook.

Global trade growth is expected to decelerate to 2.2% in 2026. Although inflation is easing—from 4.0% in 2024 to 3.4% in 2025—high prices continue to erode household purchasing power and exacerbate inequality. The report underscores that many developing countries, hampered by tight fiscal space and high borrowing costs, face severe challenges in achieving the Sustainable Development Goals, and calls for renewed collective action in trade, climate action, and development finance.