The report says the global economy suffered its lowest growth in a decade, slipping to 2.3% in 2019. The world, however, could see a slight uptick in economic activity in 2020 if risks are kept at bay.
While global growth of 2.5% in 2020 is possible, the report cautions that a flareup of trade tensions, financial turmoil, or an escalation of geopolitical tensions could derail a recovery.
"In a downside scenario, global growth would slow to just 1.8% this year. A prolonged weakness in global economic activity may cause setbacks for sustainable development, including the goals to eradicate poverty and create decent jobs for all. At the same time, pervasive inequalities and the deepening climate crisis are fuelling growing discontent in many parts of the world," the WESP report said.
UN Secretary-General António Guterres warned that "these risks could inflict severe and long-lasting damage on development prospects. They also threaten to encourage a further rise in inward-looking policies, at a point when global cooperation is paramount".
The report says that in 2019, GDP growth in East Asia slowed considerably to 5.2% from 5.7% the previous year, as high trade tensions and policy uncertainty weighed on exports and domestic demand.
Looking ahead, the region is projected to sustain a more moderate growth pace of 5.2% in 2020 and 2021. As business sentiments remain subdued, a strong revival of private investment appears unlikely. Nevertheless, the easing of monetary and fiscal policies across many economies in the region is likely to support growth.
Despite a weaker exports outlook, the growth prospects of several large East Asian economies, including Indonesia, Malaysia, the Philippines and Thailand remains favourable, underpinned by resilient domestic demand.
Private consumption will be supported by healthy labour market conditions and policy measures to boost household disposable income. In most of these countries, public investment growth is expected to strengthen, driven by the implementation of large infrastructure projects.
Economic growth in south Asia is forecast to recover to 5.1% in 2020, after falling to a decade-low of 3.3% in 2019, but it will remain well below the rates seen in the recent past.
The region struggled in 2019 with a combination of external headwinds, notably the global economic slowdown and falling trade, and country-specific internal challenges. As the effects of one-off shocks wane and governments respond with vigorous fiscal expansion, economic activity will rebound in most of the countries.