Business

World Bank upgrades global growth forecasts as recovery strengthens

WASHINGTON: For the first time in many years, the World Bank's outlook for the global economy is better than expected rather than worse, with all regions seeing improved growth, according to its latest forecast released on Tuesday.

But the bank warned that countries must make investments to improve their growth prospects, and the time to do that is before the next economic crisis hits, as it inevitably will.

"Global growth stronger than what we expected," World Bank economist Ayhan Kose said, noting that all forecasts are better than those in last June's edition of the Global Economic Prospects report.

Mr Kose, who heads the World Bank's Development Prospects Group - which twice a year prepares the forecasts - noted that the world is seeing "highly synchronised" economic expansion across regions.

That includes solid growth in the "big three" advanced economies - the United States, the eurozone and Japan - and improvements in the important emerging market economies.

Plus, large commodity exporting economies such as Russia and Brazil, which saw their economies contract in 2016, recovered last year.

Since the last forecast in June, the World Bank has upgraded nearly all of its forecasts, with global economic growth now expected to rise to 3 per cent for last year, three-tenths of a point higher than the prior estimate.

Growth is expected to hit 3.1 per cent this year and 3 per cent next year.

The biggest gains are in advanced economies, which were revised up four-tenths for last year and this year to 2.3 per cent and 2.2 per cent, respectively.

But for next year and 2020, those economies are seen slowing to 1.9 per cent and 1.7 per cent, the report said.

The report raised its forecast for China last year by three-tenths to 6.8 per cent and sees 6.4 per cent gross domestic product expansion this year. - AFP

WORLD