Global Macroeconomic Outlook of 2025
Dr. Eylem Senyuz gives Georgetown students his predictions for 2025 (Karina Bhatt/The Caravel)
Amidst four wars, 64 elections, and unlimited uncertainty, Dr. Eylem Senyuz, an adjunct professor of Investments in Emerging Markets at Georgetown University and Senior Vice President of Investment Strategy at Truist, addressed Georgetown students on Tuesday, October 8 about investing in global markets in 2025.
Due to strong legal structures in the United States, Dr. Senyuz expressed optimism regarding U.S. prospects, touting continued worldwide investment. He estimated that the S&P 500 would have a 9 percent growth rate over the next decade, 11 percent if the United States can increase productivity via artificial intelligence. He hinted at a possible area of investment, commenting, “There’s an enormous demand waiting to happen in the United States with real estate.” Responding to concerns about the upcoming elections, Dr. Senyuz assured that the market will rally regardless of the person in office, stating, “It doesn’t matter, to be honest with you, who wins.” Dr. Senyuz referenced data predicting a divided Congress, explaining that gridlock will prevent sweeping policy changes that could hurt markets. Instead, Dr. Senyuz foresees healthy market gains, with a minimal chance of recession or skyrocketing inflation.
The economic outlook for Europe remains grim, with only 0.5 percent potential growth projected over the next decade, Dr. Senyuz predicts. He attributes this poor growth to the fallout of the Russo-Ukrainian War, as well as the economic void left by the decline in Russian investments and tourism in the Mediterranean. He suggested that the “best thing that can come out of Ukraine [is another Cyprus],” a country divided between a Greece-aligned south and a Turkey-controlled north. Dr. Senyuz foresees a similar geopolitical arrangement emerging in Ukraine, with Russia maintaining control over the eastern Crimea, Donbas, and Luhansk regions currently under Russian control and the remainder of Ukraine joining the EU. Dr. Senyuz warned that without an end to conflict, Europe’s economic trajectory would continue to decline.
In contrast to Europe’s stagnation, Emerging Asia—comprised of China, India, and Southeast Asia—is expected to see sustained economic expansion. Dr. Senyuz forecasts an average growth rate of 5 percent throughout the region, with India on a trajectory to double its economy and close the gap with China within the next decade. However, Dr. Senyuz offered a more pessimistic outlook on China, citing economic struggles due to significant demographic challenges. He projected China’s population declining by over 700 million people over the next 75 years, a drop driven by declining fertility rates and an aging population. China’s economic problem is threefold: a culture shaped by the one-child policy, unequal population between west and east, and minimal immigration. Even if China could reverse course, Dr. Senyuz warned against investing in China’s controlled economy, arguing that returns are inherently limited in China’s state-controlled economic model.
He mostly excluded developing economies in Africa and Latin America from the conversation. Dr. Senyuz argued, “We always said this year it has a tremendous potential, and every year Africa fails.” Fearing political instability, Dr. Senyuz warned investors away from mineral-rich countries, such as Chile and Peru. Dr. Senyuz did not discuss politically stable developing countries, such as Botswana. Instead, he said that investors interested in capturing emerging markets should invest in Australia and Canada, portraying them as emerging markets within a stable country system.
Overall, Dr. Senyuz emphasized that while American and Asian markets are positioned for continued growth, conflicts in Europe and political instability in Africa and Latin America present significant risks for investment in those regions. He encouraged students to prioritize investment in U.S. markets, assuring them long-term returns are likely, as “people remember the negative numbers, but they don’t remember the positive numbers.”