Translated with AI
Economic growth in Europe and Central Asia will slow to 2.4% in 2025, below the 2024 level of 3.7%. This is according to a new World Bank report published in early October.
The document notes that despite global and domestic challenges, the region remains resilient. The slowdown in growth is primarily due to the decline in economic activity in Russia, which accounts for approximately 40% of the region's total output.
According to World Bank experts, if Russia is excluded from the calculations, GDP growth in the region will remain stable—at around 3.3% in both 2024 and 2025.
World Bank Vice President for Europe and Central Asia Antonella Bassani noted that to ensure sustainable growth, countries in the region need to implement structural reforms aimed at increasing productivity, creating new jobs, and adapting to demographic changes.
"To achieve these goals, we need to develop the private sector, improve the education system, and strengthen economic ties between countries. It's also important to attract private investment and transform low-wage positions into full-time jobs with growth potential," Bassani emphasized.
According to the report, key areas for accelerating economic growth should be investments in infrastructure, education, vocational training, and support for entrepreneurship. Particular attention is recommended to unlocking the potential of women and youth, which will help offset the expected decline in the working-age population—according to World Bank projections, it could shrink by 17 million people in the coming decades, particularly in Eastern and Central Europe and the Western Balkans.
At the same time, the report notes that the working-age population in Central Asia and Turkey will grow, creating new challenges – the need to ensure employment and increase productivity.
World Bank experts emphasize that economic development in the region is hampered by factors such as weak competition, limited growth opportunities for small businesses, insufficient access to finance, outdated education systems, and a high share of state-owned companies that hinder private sector development.
Ivaylo Izvorski, World Bank Chief Economist for Europe and Central Asia, noted that each country can find its own path to sustainable development by leveraging its strengths—human capital, natural resources, and infrastructure.
"If countries focus on creating quality jobs and developing skills, this will be the key to long-term sustainable economic growth," Izvorski emphasized.
