The World Bank’s January 2026 report highlights a surprisingly resilient global economy, with 2026 GDP growth projected at 2.6%. While this is a slight dip from 2.7% in 2025, forecasts have been revised upward since mid-2025, largely due to robust U.S. performance. The U.S. is expected to grow 2.2% in 2026, as domestic tax incentives help offset the significant drag caused by tariff-driven trade disruptions.

However, the Bank warns of a “fracturing” landscape: growth is heavily concentrated in advanced nations, leaving the poorest behind. Approximately 25% of developing countries still have lower per-capita incomes than they did in 2019. Meanwhile, China’s growth is cooling to 4.4%, and the Eurozone (0.9%) and Japan (0.8%) face slowdowns exacerbated by U.S. trade policies.

World Bank Chief Economist Indermit Gill noted that while the post-pandemic recovery was historically fast, the 2020s remain on track to be the weakest decade for growth since the 1960s. He cautioned that “resilience” cannot hide a lack of “dynamism” forever; without broader participation from emerging markets, the global economy risks failing to create jobs and reduce poverty while straining public finances.

End Notes

Source: https://www.reuters.com/business/finance/world-bank-sees-resilient-global-growth-2026-despite-tariffs-fading-dynamism-2026-01-13/