The year 2025 was quite challenging for the global economy due to intensified tariff wars between the biggest world economies – the U.S. and China, massive cuts to international aid, staff layoffs, natural disasters, ongoing conflicts, and other systemic shocks. However, despite all these, most projections indicate that the global real gross domestic product growth is expected to reach 3.1% in 2026, a slight decrease from the currently estimated 3.2% in 2025. With this in mind, we asked international development experts to share their opinions on the most pressing economic issues of 2025, and their thoughts on the evolution of interest rates, inflation, and economic growth in 2026. Read their opinions below to better analyze and plan your budget for 2026.
Key Takeaways:
- Some forecasts by international economic organizations expect global inflation to decline, following a slowdown in economic growth and moderation in demand.
- At the same time, by 2026, an escalation in regional conflicts could result in sustained increases in the prices of some commodities: food, fuel, and others.
- Artificial intelligence emerges as both a promise and a challenge, fueling productivity gains, reshaping industries, and redefining competitive advantage, yet also exposing gaps in regulation and uneven adoption across regions.
- Geopolitical competition will strengthen the reorganization of supply chains to enhance resilience, security, and regional diversification. This transition may elevate short-term costs; however, it has the potential to diminish vulnerability to external shocks in the long term.
DevelopmentAid: What key economic trends are expected to shape global growth in 2026?
“Emerging markets and developing economies are entering 2026 as central drivers of global rebalancing, supported by a weaker U.S. dollar, moderating inflation, and stronger domestic fundamentals. In terms of industrial real estate and infrastructure, demand is rising in these markets due to AI adoption, energy-transition supply chains’ demand, and demographic growth. Sub-Saharan Africa and the Asia-Pacific are expected to lead the expansion, while MENA benefits from logistics and hydrocarbon-linked infrastructure investments. Latin America is expected to see moderate but uneven growth, driven by digitalization, commodity demand, and foreign investment. Investors are also rotating capital into local-currency markets and higher-quality emerging market issuers, strengthening project pipelines there. For industrial infrastructure, this translates into opportunities in logistics corridors, renewable-powered industrial parks, telecommunications, data centers and resilient supply-chain nodes.”
“According to the latest World Economic Outlook (WEO), the world economic growth is projected to slow from 3.3 percent in 2024 to 3.2 percent in 2025 and 3.1 percent in 2026, with advanced economies growing around 1.5 percent and emerging market and developing economies just above 4 percent. In 2026, global growth is expected to be influenced by several interrelated factors. Further escalation of protectionist measures, including nontariff barriers, could suppress investment, disrupt supply chains, and stifle productivity growth. Larger-than-expected shocks to labor supply, notably from restrictive immigration policies, could reduce growth, especially in economies facing aging populations and skill shortages. Fiscal vulnerabilities and financial market fragilities may interact with rising borrowing costs and increased rollover risks for sovereigns. Commodity price spikes stemming from climate shocks, regional conflicts or geopolitical tensions pose additional risks, especially for low-income, commodity-importing countries. The expansion of artificial intelligence is expected to enhance productivity; however, it may also exacerbate disparities between technology adopters and lagging economies.”
Resources Management & Agricultural Development
“2026 is expected to be a year of global economic “rebalancing,” with the potential for both opportunities and risks. Some of the expected key trends are summarized below:
- Moderate global growth: According to IMF forecasts, global growth is expected to be around 3%.
- Moderate decline in global inflation: Some forecasts by international economic organizations expect global inflation to decline—following a slowdown in growth and moderation in demand.
- Structural changes—Transition to a technological era and AI: Accelerating investments in technology, especially in the fields of AI and digital infrastructure. On the one hand—innovation and growth, on the other hand—risks of a financial bubble.
- Fiscal pressures — debt, deficits, and regulation: Many economies (especially in developed countries) come with high debt, deficits, or large social-defense expenditures; this affects stability — especially if there is a slowdown in growth, or external shocks (energy prices, foreign exchange rates, geopolitical crises).
- Interest rates — not low: In developed countries, to curb inflation — central banks will probably be cautious with interest rate cuts. On the other hand, if growth slows significantly — “monetary easing” (interest rate cuts) may be possible to support the economy.”
DevelopmentAid: How might inflation, interest rates, and monetary policies evolve by 2026, and what impact could this have on emerging and developing economies?
“Global inflation is projected to ease toward ~2.3%–2.6% in 2026, with the Fed and ECB stabilizing rates near ~3.0%–3.4% and 2%, respectively. Many emerging markets central banks began cutting earlier (2024–2025), so by 2026, some will continue easing as inflation stabilizes. Others may pause due to currency volatility or commodity‑driven inflation. For emerging markets and developing economies, monetary easing is mixed: some central banks cut rates to stimulate growth, while others face inflationary pressures from currency volatility and commodity imports. A softer U.S. dollar and increased investor risk appetite are expected to spur capital inflows into emerging markets and developing economies’ infrastructure, expanding local-currency bond markets. For industrial real estate, this could mean lower financing costs, reduced default risks, and greater viability for logistics and energy-linked projects. Developers should prioritize blended finance and local-currency structures to hedge FX risks while capturing yield spreads.”
“By 2026, escalation in regional conflicts could result in sustained increases in the prices of food, fuel, and other essential commodities, with commodity-importing nations particularly susceptible to heightened inflationary pressures amid constrained fiscal space. However, inflation is projected to continue to decline globally, from 4.2 percent in 2025 to 3.7 percent in 2026, though with variation across countries, leading central banks to adopt prudent interest rate strategies. Advanced economies may progressively relax monetary conditions, whereas emerging nations must navigate the dual objectives of controlling inflation and supporting growth.”
Resources Management & Agricultural Development
“As 2026 unfolds, the global economy finds itself navigating a landscape of resilience and reinvention. Trade realignments, shaped by geopolitical tensions and shifting alliances, are redrawing the map of commerce, forcing nations to balance protectionism with the need for integration. Artificial intelligence emerges as both a promise and a challenge, fueling productivity gains, reshaping industries, and redefining competitive advantage, yet also exposing gaps in regulation and uneven adoption across regions. Fiscal stimulus, particularly in advanced economies, plays a decisive role in sustaining demand, cushioning shocks, and anchoring confidence. Inflation, once the dominant concern, gradually recedes, allowing central banks to ease interest rates with caution, though the pace of monetary relaxation varies. For emerging and developing economies, this environment offers a paradox: lower borrowing costs and stronger domestic demand on one hand, but heightened risks of capital flight, currency volatility, and tariff exposure on the other. Growth, therefore, remains both promising and precarious.”
DevelopmentAid: How could geopolitical shifts and supply-chain reconfigurations influence global economic stability in 2026?
“Geopolitical fragmentation is intensifying, with multipolar blocs reshaping trade and investment flows. Multinational companies are localizing production or reorganizing supply chains to serve regional blocs. For emerging markets and developing economies, this accelerates demand for nearshoring facilities, port infrastructure, intermodal hubs, and renewable-powered industrial parks. South–South trade corridors are expanding as well, while US-oriented supply chains remain tariff-exposed. Industrial investors must anticipate policy risks and hedge through diversified exposure, robust energy sourcing and modular buildouts. Net effect: volatility persists, but emerging markets industrial infrastructure emerges as a strategic asset class positioned at the intersection of trade, technology, and sustainability.”
“Geopolitical risk and policy uncertainty continue to weigh on the world economy. Global value chain restructuring, driven by escalating geopolitical conflicts, poses unprecedented threats to supply chain security and international economic stability. Geopolitical competition will strengthen the reorganization of supply chains to enhance resilience, security, and regional diversification. This transition may elevate short-term costs; however, it has the potential to diminish vulnerability to external shocks in the long term. Such disruptions transcend operational continuity, fundamentally reshaping global production landscapes through resource shortages, bottlenecks, and market fragmentation. Geopolitical crises thus constitute an indispensable challenge for economic analysis. They impact global operations via supply chain interruptions, trade barriers, and fractured cooperation. Tensions often trigger abrupt policy shifts in key nations, causing material volatility, cost surges, and delays that destabilize entire industrial ecosystems. Critically, the resulting ripple effects far exceed conventional disruptions in scale and duration.”
See also: The international development sector in review: 2025 insights and the path ahead | Experts’ Opinions
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