Global Economy: Stagnation, Not Collapse

The world economy is going through a phase that, observed from the surface, can be confused with stability. After a succession of large-scale crises, the main multilateral organizations agree that the global system has avoided an open recession and maintains positive growth rates. Inflation is receding, financial markets have partially stabilized and economic activity continues to expand. However, this apparent normality does not express structural strength, but rather a growing capacity to sustain fragile balances without transforming the bases of growth. The observed stability is not synonymous with progress, but with containment.

The figures allow us to better understand this paradox. In October 2025, the International Monetary Fund projected global growth of 3.2 percent for 2025 and 3.1 percent for 2026. The World Bank, incorporating more recent information and more restrictive assumptions on trade and investment, estimates a lower trajectory, with growth of 2.7 percent in 2025, 2.6 percent in 2026 and 2.7 percent in 2027 (Monetary Fund International, 2025; World Bank, 2026). These methodological differences are not contradictory. Both readings converge on the same underlying diagnosis. The expected growth is moderate, vulnerable and clearly insufficient to drive a structural transformation of the global economy.

This pattern helps explain why the inflationary slowdown has not translated into a new expansionary cycle. The reduction in inflation observed in most economies does not respond to a sustained increase in productivity, but rather to the cooling of demand and the accumulated effect of restrictive monetary policies. The result is a low growth environment combined with relatively high real interest rates, a balance that preserves nominal stability but weakens productive investment and quality job creation. The economy gains predictability, but loses momentum.

As Joseph Stiglitz has warned, disinflation obtained at the cost of economic contraction can stabilize prices in the short term, but it does so by sacrificing future growth capacities and deepening distributional tensions (Stiglitz, 2019). This risk manifests itself when monetary policy manages to contain inflation without the emergence of an alternative productivity engine to sustain expansion.

Advanced economies clearly illustrate this dynamic. The United States, the euro area and Japan have managed to avoid a deep recession thanks to the active use of fiscal policy and relatively resilient financial markets. However, this support occurs in a context of high public debt and stagnant potential growth. In the US case, debt projections far exceed 140 percent of GDP by the end of the decade, which limits the room for future maneuver (International Monetary Fund, 2025). The observed growth is based more on financial valuation and highly concentrated sectors than on generalized improvements in the productive fabric. The balance is maintained, but the basis of progress is not broadened.

Thomas Piketty has pointed out that when economic growth is persistently below the return on capital, macroeconomic stability can coexist with a growing concentration of income and wealth, eroding social cohesion and the legitimacy of the economic model (Piketty, 2014). This phenomenon helps to understand why stability in advanced economies does not necessarily translate into shared well-being.

This asymmetry becomes more evident when looking at emerging markets. The IMF highlights its resilience to the tightening of international financial conditions, but such resilience does not equate to economic convergence. More than a quarter of emerging and developing economies maintain per capita income levels lower than those recorded before the pandemic, while public debt reaches historical highs in more than half a century (World Bank, 2026). The stability achieved rests on exchange rate adjustments, spending containment and postponement of strategic investments. It is a defensive stability, built at the expense of the future.

Daron Acemoglu has stressed that without institutions capable of guiding investment towards inclusive productivity, macroeconomic stability is insufficient to generate sustainable development (Acemoglu and Robinson, 2012). In the absence of this institutional framework, resilience becomes a mere capacity for endurance, not a path to transformation.

Latin America and the Caribbean constitute a paradigmatic case of this managed stagnation. The growth projected for the region barely reaches levels that allow macroeconomic balance to be sustained, but not solve structural problems of employment, informality and inequality. Inflation shows a downward trend, but remains high in several countries. Current account deficits persist and employment becomes precarious. The region does not face an open crisis, but remains trapped in a trajectory of low growth and high external vulnerability.

As Dani Rodrik has stated, the absence of a coherent productive strategy leads to balances that avoid political collapse, but renounce long-term economic development (Rodrik, 2011). This logic is especially visible in economies that depend on external cycles without building endogenous engines of productivity.

International trade reinforces this reading. For decades it was an automatic driver of global growth. Today it grows at a lower rate than world GDP. Geoeconomic fragmentation, increased trade barriers and productive relocation introduce additional costs and reduce aggregate efficiency. This new environment especially penalizes economies with less technological and institutional capacity, widening existing gaps. The reorganization of commerce allows us to save time, but it does not redefine the course.

In this context, artificial intelligence emerges as the main focus of optimism. Its potential to raise productivity is real, but its macroeconomic impact remains uncertain and highly concentrated. Investment is directed to a limited number of sectors and companies, while the effects on employment and aggregate productivity have not yet materialized widely. Without a deliberate productive diffusion strategy, artificial intelligence risks reinforcing known patterns of economic concentration and inequality.

Mariana Mazzucato has warned that innovation only generates social value when it is integrated into clear economic missions capable of articulating public investment, the private sector and collective objectives (Mazzucato, 2018). Without this framework, technology accelerates existing processes, but does not correct their imbalances.

The underlying problem is not the absence of growth, but the absence of direction. The world economy has developed a remarkable capacity to manage crises and avoid systemic collapses, but it has lost a clear horizon of transformation. Stability has become an end in itself and resilience has replaced development as an implicit objective. Growth occurs without significantly reducing inequalities, macroeconomic variables are stabilized without strengthening social cohesion, and balances are administered that do not translate into tangible well-being for large segments of the population.

Byung-Chul Han has described this phenomenon as a meaningless logic of performance, where efficiency is multiplied while collective purpose is diluted (Han, 2015). This description helps to understand why the global economy can continue to function without moving towards a shared project for the future.

The world economy is not on the brink of the abyss, but neither is it moving towards a stage of shared prosperity. Without profound reforms aimed at inclusive productivity, strategic public investment, intelligent industrial policy and governance capable of articulating growth with equity, the dominant scenario will be one of low growth, persistent inequality and growing political fragility. The decisive question is no longer whether the system will withstand the next shock, but whether it will be able to build its own course when it stops living permanently in emergency mode.

References

Acemoglu, D., y Robinson, J. (2012). Why nations fail. Crown.
World Bank. (2026). Global economic prospects, January 2026. Washington, DC.
International Monetary Fund. (2025). Outlook for the world economy. The global economy is changing, with bleak growth prospects. Washington, DC.
Han, B.-C. (2015). The fatigue society. Herder.
Mazzucato, M. (2018). The value of everything. Allen Lane.
Piketty, T. (2014). Capital in the twenty-first century. Harvard University Press.
Rodrik, D. (2011). The globalization paradox. Oxford University Press.
Stiglitz, J. (2019). People, power, and profits. W. W. Norton.