UPDATE - OECD revises global growth forecast upwards for 2023

UPDATE WITH MORE DETAILS

By Tuba Ongun

ANKARA (AA) – The Organization for Economic Cooperation and Development (OECD) on Wednesday revised its world economic growth forecast upwards for 2023.

The global gross domestic product is projected to grow 2.7% this year, slightly up from the previous forecast of 2.6%, the OECD said in its June global economic outlook report.

The growth is expected to show a modest improvement, reaching 2.9% in 2024.

"The global economy is turning a corner but faces a long road ahead to attain strong and sustainable growth," said Clare Lombardelli, the OECD chief economist.

The recovery is backed by decreasing energy prices and inflation, slowing supply bottlenecks and the reopening of China's economy, coupled with strong employment and relatively resilient household finances, Lombardelli added.

She urged the central governments to maintain tight monetary policies as core inflation remains persistently high.

Annual consumer inflation in the Group of 20 economies is projected to fall to 6.1% this year and 4.7% in 2024 thanks to lower energy and food prices, moderating demand pressures and lower supply bottlenecks, the OECD said.

Many countries are projected to post weak growth, especially the OECD countries.

The annual GDP growth in the OECD economies is expected to come in below the trend at 1.4% in both 2023 and 2024.

In the OECD area, business investment is projected to stand still this year, and housing investment is expected to decline in many economies.

The overall GDP growth is sustained by steady hikes in private consumption and government final spending, the report said.

The OECD projected the US economy to grow 1.6% this year, helped by strong carryover effects from late 2022, and 1.0% in 2024.

China is expected to post the sharpest annual growth rate among the Group of 20 economies thanks to the lifting of the government’s zero-COVID policy.

The GDP growth is projected to come in at 5.4% in 2023 before easing to 5.1% in 2024 as the rebound associated with reopening fades.

The OECD also raised Türkiye's GDP growth forecast from 2.8% to 3.6% in its March report. While exports are projected to remain weak, domestic demand will continue to be the main driver of growth.

"The devastating earthquake at the beginning of this year brought widespread damage in southern Türkiye. However, the boost from reconstruction is expected to largely offset the negative impact from disruption to economic activity," it said.

The Turkish economy is expected to grow 3.7% next year.