World Bank Lowers Forecast for Global Economic Recovery

The World Bank’s new analysis of the global economy paints an unprecedented picture:

global output falling by 2.9 percent and world trade by nearly 10 percent; accompanied by plummeting private capital flows, likely to decline from US$707 billion in 2008 to an anticipated US$363 billion in 2009.

As the world enters what appears to be an era of markedly slower economic growth, the Bank’s annual Global Development Finance report, updates the outlook for the global economy, and explores the broad approach that will be necessary to chart a worldwide recovery.

“Extraordinary measures by governments around the world have helped save the global financial system from complete collapse, but the economic recession in the real sectors persists,”

said the Bank’s Chief Economist and Senior Vice President Justin Lin. Lin emphasized the key role that developing countries can play in the global recovery, as well as the grave development emergency posed by the impact of the crisis on poor countries. Read more…