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Banks will have to navigate new horizons in a changing world in 2024

The global banking industry faces a unique confluence of challenges and opportunities, shaped by evolving economic landscapes, technological innovations, and a pressing need for sustainable practices

February 06, 2024 | Foo Boon Ping

As we enter 2024, the global banking industry stands at a critical crossroads, marked by transformative challenges and borderless opportunities. The landscape is rapidly shifting, underpinned by complex economic dynamics, technological disruptions, and an ever-increasing emphasis on sustainability and ethical practices.

The International Monetary Fund (IMF) projected global economic growth to slow to 2.9% in 2024, the third consecutive year of slowdown, primarily due to the drag from higher interest rates to combat inflation. For advanced economies, the IMF anticipates a slowdown from 2.6% growth in 2022 to 1.5% in 2023, and further to 1.4% in 2024, as the effects of policy tightening become more pronounced. 

Meanwhile, emerging market and developing economies are expected to experience a modest decrease in their growth rates from 4.1% in 2022 to an even 4.0% in both 2023 and 2024. 

While developing economies in Asia continue to slow their growth in 2024 to 5.0%, those in the Middle East and Africa are expected to grow faster by 3.2% and 3.3%, respectively, in the year ahead.

One of the most significant challenges facing the banking sector is the intersection of global and regional economic uncertainties. Banks are not just contending with the traditional cycles of boom and bust but also grappling with geopolitical tensions and the repercussions of a changing global order. Adding to this complexity is global economic divergence, with disparities in recovery trajectories and inflation across advanced and emerging economies, creating uneven pressures and opportunities in the banking landscape. This environm...

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Keywords:Global Banking Industry, 2024 Banking Challenges, Economic Uncertainties, Advanced Economies, Developing Economies, Artificial Intelligence In Banking, Sustainable Finance, Low-carbon Economy, Banking Transformation, Emerging Banking Trends, Banking Opportunities Region