World Economy Will Slow Next Year Because of Inflation, High Rates and War, OECD Says 

Tourists browse inside a souvenir shop at the Nanluoguxiang tourism area in Beijing, China, 25 November 2023. (EPA)
Tourists browse inside a souvenir shop at the Nanluoguxiang tourism area in Beijing, China, 25 November 2023. (EPA)
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World Economy Will Slow Next Year Because of Inflation, High Rates and War, OECD Says 

Tourists browse inside a souvenir shop at the Nanluoguxiang tourism area in Beijing, China, 25 November 2023. (EPA)
Tourists browse inside a souvenir shop at the Nanluoguxiang tourism area in Beijing, China, 25 November 2023. (EPA)

The global economy, which has proved surprisingly resilient this year, is expected to falter next year under the strain of wars, still-elevated inflation and continued high interest rates.

The Paris-based Organization for Economic Cooperation and Development estimated Wednesday that international growth would slow to 2.7% in 2024 from an expected 2.9% pace this year. That would amount to the slowest calendar-year growth since the pandemic year of 2020.

A key factor is that the OECD expects the world's two biggest economies, the United States and China, to decelerate next year. The US economy is forecast to expand just 1.5% in 2024, from 2.4% in 2023, as the Federal Reserve’s interest rate increases — 11 of them since March 2022 — continue to restrain growth.

The Fed's higher rates have made borrowing far more expensive for consumers and businesses and, in the process, have helped slow inflation from its four-decade peak in 2022. The OECD foresees US inflation dropping from 3.9% this year to 2.8% in 2024 and 2.2% in 2025, just above the Fed’s 2% target level.

The Chinese economy, beset by a destructive real estate crisis, rising unemployment and slowing exports, is expected to expand 4.7% in 2024, down from 5.2% this year. China’s “consumption growth will likely remain subdued due to increased precautionary savings, gloomier prospects for employment creation and heightened uncertainty,” the OECD said.

Also likely to contribute to a global slowdown are the 20 countries that share the euro currency. They have been hurt by heightened interest rates and by the jump in energy prices that followed Russia's invasion of Ukraine. The OECD expects the collective growth of the eurozone to amount to 0.9% next year — weak but still an improvement over a predicted 0.6% growth in 2023.

The world economy has endured one shock after another since early 2020 — the eruption of COVID-19, a resurgence of inflation as the rebound from the pandemic showed unexpected strength, Moscow's war against Ukraine and painfully high borrowing rates as central banks acted aggressively to combat the acceleration of consumer prices.

Yet through it all, economic expansion has proved unexpectedly sturdy. A year ago, the OECD had predicted global growth of 2.2% for 2023. That forecast proved too pessimistic. Now, the organization warns, the respite may be over.

“Growth has been stronger than expected so far in 2023,” the OECD said in its 221-page report, “but is now moderating as the impact of tighter financial conditions, weak trade growth and lower business and consumer confidence is increasingly felt.”

Moreover, the OECD warned, the world economy is confronting new risks resulting from heightened geopolitical tensions amid the Israel-Hamas war — “particularly if the conflict were to broaden.”

“This could result in significant disruptions to energy markets and major trade routes,” it said.



Saudi's flynas Strikes Deal for Additional Airbus A320neos, 15 A330s

Saudi's flynas strikes deal for additional Airbus A320neos, 15 A330s (flynas)
Saudi's flynas strikes deal for additional Airbus A320neos, 15 A330s (flynas)
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Saudi's flynas Strikes Deal for Additional Airbus A320neos, 15 A330s

Saudi's flynas strikes deal for additional Airbus A320neos, 15 A330s (flynas)
Saudi's flynas strikes deal for additional Airbus A320neos, 15 A330s (flynas)

flynas, Saudi Arabia’s leading low-cost carrier, has signed a Memorandum of Understanding (MoU) with Airbus for 75 A320neo family aircraft and 15 A330-900. This strategic agreement will expand the airline's capacity, range and enhance its overall fleet capabilities.
Signed during Farnborough International Airshow in the presence of President of the General Authority of Civil Aviation (GACA) of Saudi Arabia, Abdulaziz bin Abdullah Al-Duailej, Chairman of the Board of NAS Holding Ayed Al Jeaid, flynas Chief Executive Officer & Managing Director Bandar Almohanna, and Airbus Chief Executive Officer, Commercial Aircraft, Christian Scherer, Airbus said on its website.
The new aircraft will join the carrier’s all Airbus fleet serving international, domestic and regional routes. The new A330-900 aircraft will boast a two-class configuration, accommodating up to 400 passengers.
"We are excited to further strengthen our long-standing partnership with Airbus," said Bander Almohanna, CEO and Managing Director of flynas. "The A320neo Family provides exceptional operational performance and environmental benefits, allowing us to offer unique, low-cost travel experiences. Additionally, the A330neowill enhance our long-haul capabilities with its advanced technology and efficiency while supporting our growth plans and Saudi Arabia’s pilgrim program."
Airbus Chief Executive Officer, Commercial Aircraft, Christian Scherer said, "We are delighted to expand our partnership with flynas through this significant milestone for both A320neo and A330-900 aircraft. The A330neo will allow flynas to further grow into widebody markets by building on the A320, benefiting from Airbus’ unique commonality. Both aircraft types offer flynas the perfect versatility and economics to expand into new markets while offering their passengers the latest cabin experience and comfort. We look forward to continuing our successful collaboration with flynas as they embark on this exciting new chapter."
The addition of the A330-900 aircraft will support flynas' ambitious growth plans. The airline anticipates significant operational efficiency gains by combining the new widebody aircraft with its existing A320neo fleet. The A330-900 offers increased capacity and range at unrivaled seat costs, ensuring flynas can compete effectively in the growing regional market, a key focus area for the airline.
The A330neo delivers unbeatable operating economics, powered by the latest-generation Rolls-Royce Trent 7000 engines, featuring new wings and a range of aerodynamic innovations resulting in a 25 percent reduction in fuel consumption and CO₂ emissions compared to previous generation competitor aircraft. The A330neo is capable of flying 8,150 nm / 15,094 km non-stop, providing ultimate comfort with more passenger space, a new lighting system, latest in-flight entertainment systems and full connectivity throughout the cabin.
As with all Airbus aircraft, the A330 family is already able to operate with up to 50% Sustainable Aviation Fuel (SAF). The manufacturer is targeting to have its aircraft up to 100% SAF capable by 2030.