IMF projects 3.3% growth in 2025 as Trump’s tariffs loom over global trade
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The IMF’s latest forecast projects global growth at 3.3% in 2025, with inflation moderating to 4.2% but warns of growing economic divergences. The US is exceeding expectations, while Europe faces sluggish expansion due to high energy costs, and China risks stagnation amid modest recovery.?
?? Poland is set to lead Europe with 3.5% growth, significantly outperforming other EU economies like Germany (0.3%), France (0.8%), and Italy (0.7%), showcasing resilience despite global challenges.?
Germany’s economic struggles continue to deepen, with a 0.2% contraction in 2024 marking its second consecutive year of recession, driven by high energy costs, weak export demand, and a skilled labour shortage.?
?? The UK’s growth forecast has been upgraded to 1.6%, though the IMF highlights risks from Donald Trump’s proposed tariffs, which could disrupt trade, reduce investment, and spark inflation.?
The newly inaugurated US President announced plans for tariffs on EU and Chinese imports, citing trade imbalances and fentanyl trafficking, prompting the EU and China to pledge to protect their interests while seeking dialogue.
?? To address these challenges, the IMF advises agile monetary policies, fiscal reforms, structural adjustments to foster innovation, and stronger global trade cooperation to ensure economic resilience.
Meanwhile this week, European leaders at the World Economic Forum in Davos also highlighted the need for strategic reforms to bolster the EU’s resilience amid global economic fragmentation and challenges posed by Trump’s trade policies.?
European Commission President Ursula von der Leyen called for deeper EU integration, focusing on energy independence, capital market unification, and regulatory simplification, while advocating for collaboration with the US and pragmatic engagement with China.?
?? At the same time, ECB President Christine Lagarde stressed the urgency of preparing for selective US tariffs and underscored energy prices and unresolved market barriers as critical to EU competitiveness.?
Join the biggest players in European real estate to strategise on how the industry can successfully adapt to these developments at the GRI UK & Europe Reunion 2025, taking place in London on February 27th.
Key insights from GRI Club’s most exclusive gathering
Last week, more than 120 of the world’s most prominent real estate industry leaders from 22 countries around the world gathered in St. Moritz for the most exclusive gathering in GRI Club’s calendar - the annual GRI Global Chairmen’s Retreat.
?? The matter of Donald Trump’s presidency was top of the agenda with discussions revealing that while trade wars and tariffs are expected to impact the EU and China, no "hot" wars are anticipated.?
It was suggested that financial markets are likely to temper extreme policy moves, and consensus settled that the US remains a dominant market and reserve currency without a clear alternative.
?? Data centres, the latest star on the horizon, were reaffirmed as offering highly attractive opportunities, although they are to be backed with caution, and the inexperience of many players in the sector was highlighted.?
The focus of the office market was revealed to be on location and flight to quality, while, despite being overbuilt and overpriced, the logistics sector is unlikely to deter investors any time soon.
?? Stay tuned for a full report with takeaways from all the discussions, coming soon to the GRI Hub.
Long-term uncertainty remains for office markets
In our latest article we share the insights shared during a recent roundtable discussion at the GRI Credit Opportunities & Real Estate Debt 2024 conference, where leading executives gathered to analyse the persisting challenges of the office real estate market.
?? Lower vacancy rates, higher tenant retention, and strong rental yields continue to attract investors to class-A office assets, which have proven to be less susceptible to current market volatility.
Despite the more promising scenario around prime office assets, discussion participants drew an interesting comparison with the retail real estate sector a decade ago, where although "good assets" initially outperformed, they eventually succumbed to structural market declines.
How sustainable resorts can transform communities
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Jesús Abellán Gómez , CEO of Arum Group , recently spoke with Gustavo Favaron , CEO of GRI Club , at GRI Hospitality Europe 2024 in Madrid to share his extensive experience in developing branded residences and luxury resorts in Spain.
?? Arum Group has established itself as a leader in residential, hotel, and leisure developments, emphasising sustainability and community integration. Renowned for its expertise in branded residences and resort projects, the group addresses challenges such as securing prime locations while driving innovation in community-focused, sustainable real estate.?
Watch the full interview with Jesús to discover how Arum Group is shaping the future of Spain's real estate landscape by blending strategic planning with efficiency.
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