The World Bank (WB) cut down its global growth forecast for 2016 due to the "disappointing" performance of large emerging as China and Brazil. AFP
World GDP, which in 2015 grew 2.4, will not grow more than 2.9%, meaning 0.4 percentage points lower than the previous forecast made in June, says the World Bank semi-annual report released Wednesday.
"The simultaneous weakness in the major emerging markets threatens the goals of poverty reduction (...) in both these countries were powerful contributors to global growth over the past decade," said BM.
China, during the economic transition slow down its expansion to 6.7% against 6.9% in 2015, meaning 0.3 percentage points lower than forecast six months ago and its worst result since 1990.
The world's second largest economy suffers for months of episodes of financial turmoil and Monday bags fell thunderously 7%.
The revision of projections is more drastic for other emerging already in recession and Brazil (-3.6 to -2.5% basic points) and Russia (-1.4 points to -0.7%). Both countries are being jaqueados by the falling prices of raw materials, commodities and energy.
Countries with higher incomes slightly better end 2016, says the World Bank. US will grow 2.7% and 1.7% in the euro area and in both cases the projection was lowered only a tenth of a percentage point, the bank said.
"The strongest growth in advanced economies only partially offset the risks of continued weakness in the major emerging," said Ayhan Kose, head of World Bank economic projections.
The organization warned of other "risk" to the global economy and geopolitical tensions and the potential impact of higher interest rates in the United States.
"There are cracks in the surface," said Kaushik Basu, World Bank chief economist and noted the risk of "dangerous movements of capital" in the world.