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The crisis will weigh heavily on growth in poor countries in 2009

July 23 category:Economy
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The crisis will weigh heavily on growth in poor countries in 2009

Economic growth in developing countries is expected to reach 2.1% this year, against 5.8% in 2008, according to the World Bank. The global GDP is expected to fall by 1.7%, driven by a fall of 2.9% GDP in the richest countries.


The World Bank is very concerned about the consequences of the crisis for developing countries if it spares almost no countries, it weakens the poorest alarmingly who may see reduced to zero "years of progress."

In its World Economic Outlook published Tuesday, March 31, WB predicted that economic growth in developing countries is expected to slow sharply in 2009, to 2.1%, against 5.8% in 2008. The institution was still predicting growth of 4 4% in November to developing countries, but has had to revise this figure down significantly "given the rapid deterioration of the economic and financial situation worldwide."

Moreover, "if we remove China and India, growth is zero" for these countries, told the press Justin Lin, Chief Economist and Senior Vice President of the World Bank. He said developing countries excluding India and China itself would experience a decline in their real income by 1.5% this year, given their population growth.

According to the new forecast of the institution of Washington, the gross domestic product of the world is expected to fall by 1.7% in 2009, falling for the first time since the Second World War, driven by a fall in GDP of 2.9% in developed countries with high incomes. The international organization was still predicting global growth of 0.9% for 2009.

Historic collapse of world trade in goods and services

The Bank also predicted a historic drop in the volume of world trade in goods and services in 2009, 6.1% compared to 2008, driven by an even stronger decline in manufacturing trade. This prediction is consistent with that of the World Trade Organization (WTO), for whom the world trade decline by 9% in 2009 because the numbers of the organization Geneva relate only to goods, while the WB also includes services, which are more resistant to the crisis.

If the economy of developing countries is expected to grow in 2009, the Bank expects a recession for the Eastern Europe and Central Asia, with a GDP decline by 2.0%, led by Russia (-4.5%) and Turkey (-2.0%), and for Latin America and the Caribbean, with a GDP decline by 0.6%. In this region, Mexico's GDP would fall by 2.0%, that of Argentina by 1.8%, while that of Brazil would rise by 0.5%.

For 2010, the Bank expects a recovery in the global economy, which is expected to grow in her 2.3%. But this prognosis is "very uncertain". The growth in developed countries would reach 1.6%, and developing countries 4.4%.

"In fact, it is a very weak recovery given the fall of 2009," said the press Hans Timmer, head of the team responsible for the analysis of global economic trends in the WB. "After a fall like this, we need a much stronger rebound just to make up for all the lost ground," he added. For him, "even if growth turns positive again in 2010, production will remain low, fiscal pressures will continue to increase and unemployment levels continue to increase in almost all countries during much of 2011".


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