Photo: Wikimedia Commons
The International Monetary Fund recently released its World Economic Outlook — and it’s not pretty.GDP growth projections growth for advanced economies were revised from 2.0 per cent to 1.5 per cent, while emerging markets were lowered from 6.0 per cent to 5.6 per cent.
Chief Economist Oliver Blanchard notes, “Explicit indexes of uncertainty, such as the VIX in the United States or the VStoxx in Europe, remain at fairly low levels.”
See the worst economies >
Blanchard suggests that this uncertainty is existential in nature, and reflects widespread doubt regarding the ability world leaders to solve the economic problems of our era. He acknowledges that the IMF’s forecasts may prove “too pessimistic” if uncertainty is reduced.
The IMF gives economic forecasts for 185 economies.
We scoured the IMF’s report and the CIA World Factbook to bring you the 20 slowest-growing economies according to their forecasted compounded annual growth rate from 2013 through 2017.
Characteristics for these underperformers includes:
- Exposure to the financial crisis;
- Reliance on exports;
- Corruption problems;
- Tourism is a dominant sector; and
- Growth prospects limited by debt and/or austerity.
The countries are ranked based on compound annual growth rates (CAGR) through 2017.
Est. 2012 GDP: 0.45%
Est. 2013 GDP: 1.25%
GDP CAGR: 1.7%
Economy: The economy of this banana-producing nation has been increasingly buoyed by tourism. The government has enacted comprehensive reforms since 2003 in an attempt to liberalize and diversify the economy. This island nation is vulnerable to hurricanes like Dean which caused damages totaling 20% of GDP in 2009.
Est. 2012 GDP: -2.22%
Est. 2013 GDP: -0.36%
GDP CAGR: 1.66%
Economy: Slovenia has among the highest amount of state control over the economy for all E.U. countries. Unemployment has continued to rise even after recovery from the recession. Foreign investment has declined in favour of India, China, and other emerging markets.
Est. 2012 GDP: -0.94%
Est. 2013 GDP: 0.76%
GDP CAGR: 1.66%
Economy: The government exerts massive control over the economy, and generates the vast majority of its revenues through oil. Sanctions for its nuclear program have devastated the oil-exporting nation. Unemployment lingers in double-digits, and Iran's most educated citizens seek work abroad.
Est. 2012 GDP: -1.02%
Est. 2013 GDP: 0.8%
GDP CAGR: 1.55%
Economy: This nation received a loan from the IMF, World Bank, and E.U. in 2008 to service its short-term debt obligations. Austerity programs magnified the impact of the recession, and the country has since instituted 'crisis taxes' on financial, energy, telecommunications, and retail companies.
Est. 2012 GDP: -0.46%
Est. 2013 GDP: 0.39%
GDP CAGR: 1.51%
Economy: Dutch banks suffered a high magnitude of losses from their exposure to U.S. mortgage-backed securities. Agriculture employs only 2% of the Dutch labour force, yet produces a surplus. A focus on deficit reduction in the short-term will likely dampen growth expectations in the Netherlands.
Est. 2012 GDP: 0.12%
Est. 2013 GDP: 0.37%
GDP CAGR: 1.34%
Economy: This nation is the most popular tourist destination. New President Francois Hollande has advocated deficit spending, separation of depository banks from investment banks, increasing taxes on financial institutions, and introducing a millionaire's tax in order to restore economic growth.
Est. 2012 GDP: 0.89%
Est. 2013 GDP: 1.05%
GDP CAGR: 1.28%
Economy: Services, particularly tourism, account for nearly two-thirds of Jamaica's GDP. The level of debt exceeds the GDP, while unemployment, crime, and corruption are barriers to growth.
Est. 2012 GDP: 0.94%
Est. 2013 GDP: 0.85%
GDP CAGR: 1.27%
Economy: The largest E.U. economy is hindered by the poor performance of other member nations. German growth has been limited to a decline in demand for its exports, especially from within the E.U. In the long term, Germany must reverse its low fertility rates and falling immigration to provide an environment conducive for economic growth.
Est. 2012 GDP: 1.21%
Est. 2013 GDP: 1.28%
GDP CAGR: 1.2%
Economy: Tuvalu's labour force is among the tiniest in the world, and those who do not practice subsistence farming rely on transfer payments from overseas. Tuvalu is dependent on imported food and energy, and a decline in tourism has dampened the nation's economic outlook.
Est. 2012 GDP: -6%
Est. 2013 GDP: -4%
GDP CAGR: 1.19%
Economy: Multiple credit agencies have downgraded Greek debt, as whispers of an exit from the E.U. have picked up momentum. Austerity has been met by mass protests, and proves to be a main headwind to economic growth. Creditors may need to write down Greek debt as the country seeks support from E.U. members.
Est. 2012 GDP: -3%
Est. 2013 GDP: -1.02%
GDP CAGR: 1.16%
Economy: Investment has moved to lower-cost countries. Portugal's GDP per capita is far below the E.U. average. Austerity measures like a public salary cut and increase in the VAT to curb debt have not fostered economic growth.
Est. 2012 GDP: 2.22%
Est. 2013 GDP: 1.23%
GDP CAGR: 1.15%
Economy: Japan has doubled down on its 'Lost Decade.' In addition to tensions with China, the recession has reduced demand for Japan's exports, and the risk of deflation remains high. Business investment, which spurred growth in the 70s and 80s, has fallen drastically.
Est. 2012 GDP: 0.04%
Est. 2013 GDP: 0.34%
GDP CAGR: 1.13%
Economy: Belgium, a country with few natural resources, is vulnerable to global price shocks as well as E.U. downturns. Public debt is equal to GDP, and the nation must deal with funding or reforming its welfare system as the population ages.
Est. 2012 GDP: 7.54%
Est. 2013 GDP: 3.44%
GDP CAGR: 1.13%
Economy: This impoverished nation has few private enterprises and operates as a command economy. Nearly 80% farm to meet their own needs, and poor harvests have left the country with an inadequate supply of food. Mineral extraction is Eritrea's best potential source of wealth.
Est. 2012 GDP: -2.57%
Est. 2013 GDP: -0.5%
GDP CAGR: 1.03%
Economy: San Marino is reliant on tourism, banking, and textiles -- all industries in decline since the recession. Exports to Italy, which receives 90% of San Marino's goods, have plunged. Foreign investment, previously popular due to a corporate-friendly tax environment, has also tanked.
Est. 2012 GDP: -1.54%
Est. 2013 GDP: -1.3%
GDP CAGR: 0.94%
Economy: 16 years of growth ended with the recession, from which Spain was the last major economy to recover. Stimulus spending did not help the labour situation in Spain, and unemployment spiked to 20%. Spain's economy is crippled by rising debt, interest rates, and unemployment, and it is becoming increasingly apparent that Spanish banks need help from the ECB and E.U. member countries.
Est. 2012 GDP: -2.25%
Est. 2013 GDP: -0.96%
GDP CAGR: 0.93%
Economy: The service sector accounts for 80% of Cyprus' GDP. Tourism is the main sector and responsible for sporadic growth. Cypriot banks have a high degree of exposure to Greek bonds, which has led to a credit squeeze and increase in borrowing costs.
Est. 2012 GDP: -2.3%
Est. 2013 GDP: -0.73%
GDP CAGR: 0.76%
Economy: Italy's rising public debt weighs on its economy growth, and austerity measures blunt the recovery. The nation's underground economy is estimated to be as much as 17% of GDP. Structural impediments to growth include an inflexible labour market, poor tax collection, and a low fertility rate.
Est. 2012 GDP: 5.6%
Est. 2013 GDP: 6%
GDP CAGR: 0.5%
Economy: The IMF and World Bank cut off funding to Equatorial Guinea in 1993 due to government corruption concerning the use of oil revenues. The nation is dependent upon its reserves of oil and gas, though most of the country engages in subsistence farming, which adds little to GDP.
Est. 2012 GDP: -2.9%
Est. 2013 GDP: -1.0%
GDP CAGR: -0.01%
Economy: Swaziland is dependent upon South Africa, which provides 90% of its imports. Customs revenues have plummeted after the recession, contributing to 40% unemployment in the nation. This is the only country whose economy is projected to contract from 2013-2017.
Business Insider Emails & Alerts
Site highlights each day to your inbox.