In this article, we will look at the 16 Fastest-Declining Economies in the World in 2024.
The global economy is expected to grow at 3.2% and 2.7% in 2024 according to the IMF and UNCTAD, respectively. The last time we covered this topic (See here: 15 Fastest-Declining Economies in the World in 2024), the global economy was expected to grow at around 2.6% in 2024, slightly edging the recession threshold of 2.5%. However, things started to improve following the fading fear of recession and the Fed’s rate cut in September. The US economy has performed better than expected considering the recession fears in the first half of the year. The US stock market has been the top performer with the S&P 500 index soaring over 26% year-to-date, as of November 26. Similarly, other indexes including Nasdaq Composite, Russell 2000 Index, and Dow Jones Industrial Average have soared over 29%, 21%, and 18% year-to-date, respectively. On average these four leading indexes have surged more than 23% in 2024 so far.
Fastest Declining Economies in 2024
On the contrary, the majority of the fastest declining economies in the world in 2024 have been struggling and facing risks such as extreme poverty, climate change, political unrest, and wars, among major issues. Countries including Sri Lanka, Yemen, Lebanon, Venezuela, Myanmar, Ukraine, West Bank and Gaza, and South Sudan have a longstanding history of political instability and wars.
Ukraine’s economy, after declining by more than 28% in 2022 due to war, recovered to a growth of 5.3% in 2023 and is expected to maintain growth of around 3% in 2024. However, the war between Russia and Ukraine has once again started to escalate as Ukraine is now acting as an aggressor with the support of its allies. Whereas, Israel’s aggression on Lebanon and West Bank and Gaza continues to heighten, while the International Court of Justice (ICU) has issued a warrant against Israel’s Prime Minister Benjamin Netanyahu. The war in the Middle East has impacted the economic situation in the region.
Economic Trends in 2024
As far as economic trends in 2024 are concerned, headline inflation across the G20 is expected to decline from 6.1% in 2023 to 5.4% in 2024, continuing to 3.3% in 2025. Whereas, core inflation in the G20 advanced economies is projected to fall from 4.2% in 2023 to 2.7% in 2024 and then further plunge to 2.1% in 2025. The fall in headline and core inflations will be driven by stringent monetary policies and easing pressures on goods and energy prices. The inflation in the emerging-market economies is anticipated to remain generally higher compared to the advanced economies. By the end of 2025, most of the global economies are projected to achieve central bank inflation targets and experience solid growth.
According to Goldman Sachs Research forecasts, the U.S. will perform better than expected while the euro area is expected to suffer considering the anticipated tariffs from the Trump administration. The euro area is expected to report growth of just 0.8%, underperforming the consensus of 1.2%. The U.S. GDP is expected to increase 2.5% in 2025, ahead of the projections of 1.9%. That’s why the U.S. is known to have one of the best economies in the world. Similarly, another leading economy in the world is India, with a projected growth of 6.7% in 2024 and 6.8% in 2025, which ranks India among the top 10 fastest-growing economies in the world.
The labour market pressures have continued to ease throughout 2024. Unemployment has increased in some of the largest economies in the world in 2024 such as the U.S., Canada, Türkiye, India and South Africa. In addition to that, job vacancies have plunged steadily from peak levels recorded during the COVID-19 pandemic. This reflects a moderating demand, however, in some areas increasing labour supply has also been an important element.
Also see 50 Largest Economies in the World in 2024 and 25 Fastest Growing Economies in the Last 50 Years.
What Are the Next Fastest Declining Economies in the World?
According to the IMF’s real GDP growth projection for the next five years, major economies such as Japan, Germany, Austria, Belgium, France, and the United Kingdom are expected to have a declining growth trend. In the next five years, Japan is expected to grow at an average rate of just under 0.70%, while Germany and the United Kingdom will grow at an average of 0.80% and 1.40%, respectively.
With that, let’s take a look at the 16 fastest declining economies in the world in 2024.
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Our Methodology
To identify the fastest declining economies in the world in 2024, we averaged the real GDP growth rates of countries for the last 5 years, from 2019 to 2023. We selected the 16 countries with the lowest average GDP growth rates over the 5 years. The data on the real GDP growth rate was obtained from the International Monetary Fund’s (IMF) database. The fastest declining economies are ranked in ascending order of their average 5-year real GDP growth rates.
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NOTE: A few countries such as Syria were left out due to the unavailability of the data.
16 Fastest Declining Economies in the World in 2024
16. South Sudan
Average GDP Growth: -0.60%
South Sudan is expected to drop its real GDP growth by almost 26%, making it the fastest-declining economy in 2024. Over the past five years, South Sudan has plunged its growth by nearly 0.60%. The country is suffering from a severe humanitarian crisis as 9 million people, including refugees, are expected to have critical needs in 2024. Women and children are most vulnerable.
15. West Bank and Gaza
Average GDP Growth: -0.84%
The West Bank and Gaza’s growth rate for 2024 is yet to be accumulated by the IMF as the region is under siege. The current situation is pretty bad in Gaza as the region faces fierce bombing and invasion from Israel. The ongoing conflicts in the region have severely impacted the economy, especially in the West Bank and Gaza.
14. Myanmar
Average GDP Growth: -1.28%
Myanmar’s economy is on a constant decline and is expected to grow only 1% in 2024. In the next five years, Myanmar’s real GDP growth is expected to be merely at 1.30%, making it one of the fastest-declining economies in the world in 2024. According to a report by the UN Development Program, the middle class in Myanmar has shrunk by nearly 50% over the past three years.
13. Trinidad and Tobago
Average GDP Growth: -1.42%
Trinidad and Tobago has one of the lowest GDP growth rates in 2024, with a projected growth of 1.60%. In the next five years, Trinidad and Tobago is anticipated to grow at an average of 2%, making it one of the fastest-declining economies in 2024.
12. Yemen
Average GDP Growth: -1.58%
Yemen has been suffering from war for decades and the economy continues to shrink as conflicts and regional tensions exacerbate the nation’s economic and humanitarian crises. Yemen’s GDP growth is expected to drop by 1% in 2024 and ranks 12th among the fastest-declining economies in the world in 2024.
11. Haiti
Average GDP Growth: -2.08%
Haiti’s economic growth has contracted by more than 2% from 2019 to 2023. In 2024, Haiti’s GDP is projected to plunge by almost 4%, continuing the declining trend. With rising insecurity and ongoing political instability, Haiti is projected to grow at an average of just 0.30% in the next five years, as per the IMF growth projections.
10. Libya
Average GDP Growth: -2.10%
Libya’s economy has shown resilience and is expected to have a growth rate of almost 2.40% in 2024. In the next five years, Libya’s economic growth is set to recover and grow at an average of under 5%. Libya’s economy is mainly driven by the oil and gas sector and remains undiversified, with a large public sector.
9. Sri Lanka
Average GDP Growth: -2.18%
Sri Lanka’s economic downfall became evident after its GDP contracted by 7.30% in 2022 and the poverty rates reached over 25% in 2023. Despite things getting normal in the country, high poverty, rising income inequality, and reduced labour force are key to Sri Lanka’s slow economic growth. Therefore, Sri Lanka ranks ninth on our list of fastest-declining economies in the world.
8. Equatorial Guinea
Average GDP Growth: -2.38%
Equatorial Guinea’s major issue is its high urban poverty at 67% and inflation at almost 5%. The economic growth is expected to reach 5.80% in 2024 on the back of its energy sector as Equatorial Guinea is deeply intertwined with its oil and gas sector. However, the average economic decline of more than 2.30% over the past five years makes Equatorial Guinea one of the fastest-declining economies in the world.
7. Suriname
Average GDP Growth: -2.54%
Suriname’s economy plunged by a whopping 16% in 2020 during the pandemic. However, the economic growth is expected to remain consistent in the next five years and have an average growth rate of 3% in the next five years. Suriname ranks seventh among the fastest-declining economies in the world in 2024.
6. Afghanistan
Average GDP Growth: -3.30%
Afghanistan’s economy is recovering following the takeover by the Taliban government. However, the country still needs a lot of development and with an average growth contraction of 3.30% from 2019 to 2023, Afghanistan is one of the fastest-declining economies in the world.
5. Palau
Average GDP Growth: -3.38%
Palau is expected to pick up pace and have a growth of 6.8% in 2024 and then further grow to 8% in 2025. After 4 consecutive years of economic contraction, Palau’s economy is experiencing a positive outlook driven by a significant rise in tourism.
4. Ukraine
Average GDP Growth: -4.14%
Ukraine continues to suffer from the war and the economy massively contracted in 2022 to almost 29%. In 2024, Ukraine’s economic growth is projected around 3%. The consequences of war have a large impact on the economy making it one of the fastest declining economies in the world.
3. Sudan
Average GDP Growth: -5.28%
Sudan faces several issues and food crises are among the biggest of them. The currency has depreciated significantly causing high inflation. In 2024, Sudan is expected to experience a decline in growth to almost 20%, making it one of the fastest-declining economies in the world in 2024.
2. Lebanon
Average GDP Growth: -5.82%
Lebanon has been at war for many years now. In 2024, things escalated following the war between Hezbollah and Israel. Lebanon’s economy has contracted by an average of just under 6% over the last five years. Apart from the war, Lebanon has been facing political crises as well.
1. Venezuela
Average GDP Growth: -8.94%
Venezuela is facing severe economic challenges, with hyperinflation crossing 344% in 2023, which had a massive impact on purchasing power. Since 2013, Venezuela’s economy has contracted by almost 75% leading to widespread poverty. In addition, international sanctions have drastically affected economic growth. Venezuela ranks first among the fastest-declining economies in the world in 2024.
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Disclosure. None. This article was originally published on Insider Monkey.
