We expect most of the 2020s to be characterised by slow growth and very low inflation as persistently weak productivity growth leaves the developed world looking distinctly Japanese. But technological developments should ultimately bear fruit and we forecast that a pick-up in output per worker from late in the decade will help offset the decline in working age populations, keeping global growth close to 3%. Growth in emerging economies will continue to outpace that in the developed world, but not to the extent seen in the recent past. The process of reform and market liberalisation has stalled in many large EMs and some of the previous gains from opening up to international trade could be lost as the current wave of globalisation ends.
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