CAREC Institute’s Quarterly Economic Monitor No.12

The CAREC Institute released its Quarterly Economic Monitor #12 which highlights that despite challenges such as geopolitical tensions potentially causing geoeconomic fragmentation, climate change accompanied by more frequent natural disasters and increasing water scarcity, woes in the PRC’s real estate sector, receding but partially still high inflation, real GDP growth in the CAREC region was generally relatively strong in the CAREC region in 2023 and is forecast by main International Financial Institutions to remain so also in 2024 and 2025. This opens a window of opportunity to accelerate required policy re-orientations for adapting to the new realities, take precautionary measures against the impact of climate change, decarbonize, advance modern technologies, promote desirable socio-economic change while mitigating potential negative consequences for the parts of society which might lose out from technological progress. Trade openness has increased in 2022 and 2023 in most CAREC economies. At the same time the polarization between trade surplus countries and trade deficit countries has increased. This calls for measures to increase competitiveness where trade deficit countries might have certain comparative advantages such as in agriculture or downstream production related to mining.