The Conference Board recently released its updated Global Economic Outlook 2022. This comprehensive forecast covers 77 economies around the world through 2031, examines the drivers of future growth, and considers both upside and downside risks to economic activity.

Despite the setback from the emergence of the Delta variant in 2021, the global economy is still on course to expand by a robust 5.1 percent in 2021, and 2022 will likely bring another year of above-potential recovery growth. Beyond that, we expect global growth to slow to an average of about 2.5 percent per year over the next 10 years - a much slower rate that that seen in the decades prior to the pandemic. Most of the slowdown will be attributed to weakening quantitative sources of growth, including growth in the workforce and capital intensity levels. However, qualitative growth drivers, including productivity and upskilling of the workforce and the capital stock, are expected to improve in the next decade. Still, these factors will not be enough to halt the slowing overall trend.

Numerous risks lurk in the next decade as well. The main challenges to the global economy are likely to come from a continued trend toward deglobalization and faster-than-expected inflation. The transition toward decarbonization of economies in response to climate change will create challenges and opportunities for global growth as well. Lessons learned about resilience in the face of disruption during the pandemic will become increasingly important in the years ahead.