Global Economy on the Brink as Modern Slavery Surges Amidst Volatility

The global economy faces a significant slowdown in 2025, with growth projected to decelerate to 2.6% from 2.9% in 2024, according to a new report released on Tuesday by the UN Trade and Development body (UNCTAD). This downturn is primarily attributed to escalating financial volatility and persistent geopolitical uncertainty impacting global trade and investment.

UNCTAD's "Trade and Development Report 2025: On the Brink" highlights that shifts in financial markets now exert an influence on global trade almost as strongly as actual economic activity. This trend significantly shapes development prospects worldwide, as noted by Xinhua on December 3, 2025.

Developing economies, despite showing faster growth rates, are confronting mounting pressures. High borrowing costs, financial market instability, and increasing climate risks are severely limiting their capacity to invest and sustain growth, unctad reported on December 2, 2025.

Concurrently, the world is witnessing a concerning rise in global modern slavery, affecting an estimated 50 million people worldwide. This alarming figure was underscored by the UN Secretary-General António Guterres on December 2, 2025, during the International Day for the Abolition of Slavery.

Secretary-General Guterres described modern slavery as a "relentless contemporary crisis," emphasizing that millions are trapped in various forms of exploitation, including forced labor and forced marriage. The UN Human Rights Office (OHCHR) further stated on December 2, 2025, that slavery is evolving faster than current responses.

The surge in modern slavery is intrinsically linked to a confluence of global crises, including the lingering effects of the COVID-19 pandemic, ongoing armed conflicts, and the escalating impacts of climate change. These factors exacerbate extreme poverty and forced migration, making individuals more vulnerable to exploitation, as detailed by the International Labour Organization (ILO) in its 2022 report.

The economic and human rights challenges presented in these reports paint a stark picture of interconnected global vulnerabilities. Addressing these issues requires comprehensive and coordinated international efforts, focusing on both financial stability and human protection, according to unCTAD and other UN bodies.

• Detailed Economic Outlook: The UNCTAD's "Trade and Development Report 2025" indicates that global economic growth will remain subdued at 2.6% in 2025 and 2026, falling below the pre-pandemic average of 3% and significantly lower than the 4.4% average before the 2008-2009 financial crisis, as reported by unCTAD on December 3, 2025. This forecast reflects a deteriorating policy environment and the increasing influence of financial conditions on trade flows, according to unCTAD Secretary-General Rebeca Grynspan.

• Vulnerabilities of Developing Economies: Developing economies are projected to grow by 4.3% in 2025, outpacing advanced economies, yet they face severe financial constraints. They incur significantly higher borrowing costs, ranging from 7% to 11% compared to 1% to 4% in major advanced economies, Xinhua reported on December 3, 2025. Furthermore, climate-vulnerable nations pay an estimated $20 billion more annually in interest due to perceived risk, accumulating to $212 billion since 2006, according to unCTAD.

• Impact of Dollar Dominance: The UNCTAD report highlights the persistent centrality of the U.S. dollar in global finance, with its share of cross-border payments via SWIFT increasing to approximately 50% over five years. This dominance, while offering some stability during financial shocks, exposes developing countries to U.S. financial cycles that they have little power to influence, UNCTAD Secretary-General Rebeca Grynspan stated.

• Modern Slavery Statistics and Drivers: The 2022 Global Estimates of Modern Slavery, produced by the ILO, Walk Free, and IOM, reveal that 50 million people were living in modern slavery in 2021, including 28 million in forced labor and 22 million in forced marriage. This represents a substantial increase of 10 million victims since 2016, with women and children being the most affected, as noted by the ILO.

• Root Causes and Exacerbating Factors: The rise in modern slavery is fueled by global crises such as the COVID-19 pandemic, armed conflicts, and climate change, which lead to increased poverty, unemployment, and forced migration, according to a September 2022 Reuters report. The World Economic Forum highlighted in January 2025 that fragmented data systems across corporate, civil society, and public sectors impede effective identification and intervention against modern slavery.

• Economic Dimensions of Forced Labor: Forced labor is a highly profitable illicit industry, generating an estimated $236 billion in annual global profits, which represents wages stolen from exploited workers, the un reported. This illicit financial flow not only deprives individuals but also burdens public institutions with significant costs for law enforcement, healthcare, and victim support, as highlighted by the World Economic Forum.

• Challenges in Combating Modern Slavery: Despite the UN's Sustainable Development Goal 8.7 to eradicate modern slavery by 2030 and end child labor by 2025, progress is insufficient, and the child labor target was regrettably missed, the ohchr stated on December 2, 2025. The Global Commission on Modern Slavery and Human Trafficking, which presented findings in April 2025, emphasizes that the issue has slipped down the political agenda in recent years, requiring renewed momentum.

• Recommendations for Global Action: UNCTAD advocates for targeted reforms to global financial systems, including expanded public trade-finance guarantees for climate-vulnerable economies and counter-cyclical liquidity from multilateral development banks. The OHCHR also calls for stronger national laws, robust enforcement, and greater transparency in supply chains to effectively combat modern slavery and protect vulnerable populations.