The World
Bank on Sunday maintained its forecast that global growth will improve to 2.7
percent this year, citing a pickup in manufacturing and trade, improved market
confidence and a recovery in commodity prices.
The update
of the multilateral development lender's Global Economic Prospects report
marked the first time in several years that its June forecasts were not reduced
from those published in January due to rising growth risks.
The World
Bank's 2017 global growth forecast of 2.7 percent compares to its 2.4 percent
estimate for 2016, a figure that was increased by a tenth of a percentage point
since January.
The World
Bank said advanced economies were showing signs of improvement, especially
Japan and Europe, while the seven largest emerging markets - China, Brazil,
Mexico, India, Indonesia, Turkey and Russia - were again helping to drive
global growth.
"With a
fragile but real recovery now under way, countries should seize this moment to
undertake institutional and market reforms that can attract private investment
to help sustain growth in the long term," World Bank President Jim Yong
Kim said in a statement.
The bank
boosted its 2017 growth forecast for Japan by 0.6 percentage point since
January to 1.5 percent, while the euro zone's forecast was increased by 0.2
percentage point to 1.7 percent. In both cases, a pickup in exports and
unconventional monetary easing are helping to support growth.
The World
Bank said U.S. growth also is improving but it shaved 0.1 percentage point off
its forecast for 2017 to 2.1 percent after weak growth early in the year caused
by a pullback in consumer spending it viewed as temporary. It slightly lifted
its 2018 U.S. growth forecast to 2.2 percent.
It left
unchanged its forecast that China's growth would slow to 6.5 percent from 6.7
percent last year and predicted that commodity exporters Argentina, Brazil,
Nigeria and Russia will see recessions end and positive growth resume this
year.
But the
World Bank warned that new trade restrictions could derail the recovery in
trade that is benefiting many advanced and developing economies, citing actions
being contemplated by the Trump administration.
uch
restrictions could fall disproportionately on China and other Asian economies,
the bank said.
"Significant
disruption to China's exports would undermine its growth with large spillovers
on the region," the bank said in the report. "Furthermore,
trade-restricting measures in the United States could trigger retaliatory
measures."
It said
exports and investment in Mexico also could be negatively affected by the
looming renegotiation of the North American Free Trade Agreement, causing
spillovers to Central America as well.
REUTERS*
0 Comments