The world economy 2011 has entered a very difficult phase characterized by significant downside risks and uncertainties. Fiscal crisis in the Europe might threaten the entire existence of the Eurozone. The United Stated, the world largest economy, the first time in history, its sovereign debt was downgraded High inflation is still hot topic in Asia in 2011. Furthermore, political turnmoil in Middle-East and North Africa, Tohucu disaster in Japan and severe summer floods in Thailand dampened the global economic recovery that is inherently fragile. From macroeconomic developments and economic index of the year, this paper gives an overview of the world economy in 2011 and prospects for 2012.