The world economy is projected to grow by 2.7 percent in 2017 and 2.9 percent in 2018, said a UN report launched here on Tuesday, pointing out that the global economy has not yet emerged from the period of slow growth.
This modest recovery is more an indication of economic stabilization than a signal of a robust and sustained revival of global demand, said the UN annual economic report World Economic Situation and Prospects.
It noted that in 2016, the world economy expanded by just 2.2 percent, the slowest rate of growth since the Great Recession in 2009.
"Underpinning the sluggish global economy are the feeble pace of global investment, dwindling world trade growth, flagging productivity growth and high levels of debt," said the report.
The report noted that global economic prospects remain subject to significant uncertainties and risks that are weighted on the downside, with the potential to obstruct the modest growth forecast for 2017-18.
It said among the uncertainties are interest rate rises in the United States, the forthcoming changes by the new administration of the United States to international trade policies as well as Brexit and its potential implications for free movement of goods and workers in Europe.
Launching the report at the UN Headquarters in New York, Lenni Montiel, UN assistant secretary-general for economic development, said the world needs to "redouble the efforts to bring the global economy back on a stronger and more inclusive growth path and create an international economic environment that is conducive to sustainable development."
In order to restore the global economy to a healthy growth trajectory over the medium-term, a more balanced policy approach is needed, the report said.
"Effective financial regulation and incentives should mobilize resources and encourage investment in inclusive and resilient infrastructure, social services and green technology," it said.
In addition, policies should encourage a dynamic business environment aligned with sustainable development, including inclusive access to finance, transparent administrative procedures and effective regulatory frameworks, it added.
The report also called for deeper international cooperation in such areas as expediting clean technology transfer, supporting climate finance, strengthening international tax cooperation and tackling illicit financial flows.