Beijing, January 18, 2012 – Developing countries should prepare for
further downside risks, as Euro Area debt problems and weakening
growth in several big emerging economies are dimming global growth
prospects, says the World Bank in the newly-released Global Economic
Prospects (GEP) 2012.
The Bank has lowered its growth forecast for 2012 to 5.4 percent for
developing countries and 1.4 percent for high-income countries (-0.3
percent for the Euro Area), down from its June estimates of 6.2 and
2.7 percent (1.9 percent for the Euro Area), respectively. Global
growth is now projected at 2.5 and 3.11 percent for 2012 and 2013,
respectively.
Slower growth is already visible in weakening global trade and
commodity prices. Global exports of goods and services expanded an
estimated 6.6 percent in 2011 (down from 12.4 percent in 2010), and
are projected to rise by only 4.7 percent in 2012. Meanwhile, global
prices of energy, metals and minerals, and agricultural products are
down 10, 25 and 19 percent respectively since peaks in early 2011.
Declining commodity prices have contributed to an easing of headline
inflation in most developing countries. Although international food
prices eased in recent months, down 14 percent from their peak in
February 2011, food security for the poorest, including in the Horn of
Africa, remains a central concern.