WB forecasts economic recession in developing countries in 2009
The economic growth of developing countries is affected by the world financial recession, coming after 5 years of robust growth of the world economy. It is probable that next year, the developing countries’ economies register a growth rhythm of 4.5 %, that is 3.4 % less than in 2007, and the developed countries – register negative values, reads the report “Global Economic Perspectives (PEG) 2009,” worked out by experts of the World Bank, quoted by Info-Prim Neo.
"People from the developing countries face two major external shocks: growth of food and fuel prices, and the financial crisis, which lessened tensions on the goods market, but it tries the banking systems and threatens with staff layoffs worldwide,” says Justin Lin, a senior economist and main deputy chief of the World Bank.
Taking into account diminishing the growth of the world's GDP to 2.5 % in 2008, and 0.9% in 2009, the report’s authors say that an urgent implementation of measures is needed that would help remedy the crisis’ consequences, which affect the real economy, and the vulnerable social classes. So, the World Bank group will increase its support for the developing countries.
Thus, the World Bank for Reconstruction and Development (WB) will provide $100 billion the next three years, for new projects. The International Financial Corporation (IFC) will finance the private sector and the private-financing infrastructure projects facing financial difficulties.
As to the price of petroleum, the World Bank’s report (2009) anticipates, for the next year, the barrel will be $75. At the same time, the WB expects a sufficient offer of world-level food, which will bring to drops of 23 % of the food prices, compared with their average in 2008.