The global economy is heading into uncharted territory, according toKearney’s Global Economic Outlook 2025–2027. The report investigates the world adjusting to fragmentation, rising geopolitical tension, and economic policy uncertainty, which are set to shape growth prospects over the next three years.

Key developments include U.S. tariffs, heightened geopolitical risks, and the impact of industrial policy which restrain global growth expectations to an average of ~2.5% between 2025 and 2027. This is well below estimates and pre-pandemic levels, which exceeded 3%.

In a notable shift, the Middle East and Africa (MEA) are set outpace Asia and Australasia as the fastest-growing region globally, with an average growth forecast of 3.6% through 2027. The MEA region plays a strategic role in global energy and commodity markets, insulating it to some degree from the impact of U.S. trade policies. This regional growth momentum suggests opportunities for South Africa, though the country needs to address energy instability, political uncertainty, and policy inconsistency to fully capitalize on these regional tailwinds.

The report is especially relevant for South African corporates and policymakers navigating local challenges in a complex global context, underlining the need for strategic scenario planning and agility.

“Clarity on non-regret moves and the agility to take advantage of emerging opportunities becomes critically important for organisations in a volatile global operating environment,” said Kearney Africa’s Managing Partner, Theo Sibiya.

Global industrial production is likely to experience a shallow recession, and sectors dependent on imported inputs, like South Africa’s automotive manufacturing, may be particularly vulnerable. Conversely, global services are expected to remain more stable, offering a potential upside for South Africa’s BPO, fintech, and digital services industries.

Kearney identifies five key drivers that will shape the global and regional economic trajectory through 2027:

The report lays out four scenarios for how these forces could evolve, with three of the four suggesting growth outcomes below the 2.5% baseline. Depending on how these variables interact, average global growth through 2027 could dip as low as -1.8% or climb to 2.6%.

For South Africa, the global picture is mixed but not without opportunity. The regional outlook for Africa remains strong, and there is a clear call to action: businesses must build resilience, deepen innovation, and stay agile in a rapidly shifting global environment.