BISHKEK (TCA) — Economic growth could resume modestly in Central Asia if there is a stabilization of commodity prices, according to the World Bank’s January 2016 Global Economic Prospects.
In Europe and Central Asia, growth is projected to rise to 3 percent in 2016 from 2.1 percent in the year just ended as oil prices fall more slowly or stabilize and Russia’s economy improves. Economic activity in Russia is projected to contract by 0.7 percent in 2016 after shrinking by 3.8 percent in the year just ended, the report says.
Growth in China is forecast to ease further to 6.7 percent in 2016 from 6.9 percent in 2015.
Weak growth among major emerging markets will weigh on global growth in 2016, but economic activity should still pick up modestly to a 2.9 percent pace, from 2.4 percent growth in 2015, as advanced economies gain speed, according to the report.
“More than 40 percent of the world’s poor live in the developing countries where growth slowed in 2015,” said World Bank Group President Jim Yong Kim. “Developing countries should focus on building resilience to a weaker economic environment and shielding the most vulnerable. The benefits from reforms to governance and business conditions are potentially large and could help offset the effects of slow growth in larger economies.”
Global economic growth was less than expected in 2015, when falling commodity prices, flagging trade and capital flows, and episodes of financial volatility sapped economic activity. Firmer growth ahead will depend on continued momentum in high income countries, the stabilization of commodity prices, and China’s gradual transition towards a more consumption and services-based growth model, the report says.
Developing economies are forecast to expand by 4.8 percent in 2016, less than expected earlier but up from a post-crisis low of 4.3 percent in the year just ended. Growth is projected to slow further in China, while Russia and Brazil are expected to remain in recession in 2016.