The World Bank said on Tuesday that it had lowered its projection for the 2014 global economic outlook. It said that while developing countries were likely to report \"disappointing growth,\" the economy of high-income countries was anticipated to gain momentum. The bank based in Washington, U.S., forecasts a 2.8% for the global economy in the current year as compared to January estimate of 3.2%.
According to the biannual publication – Global Economic Prospects report – the World Bank predicts that the first quarter weakness that was observed in 2014 has prevented economic activity from picking up as expected. Similarly, the unprecedented bad weather in the U.S., rebalancing in China, the Ukraine crisis, and a number of middle-income economies facing political strife have slowed down structural reform, the report further added.
In the backdrop of these changes, the World Bank has lowered its forecast for developing countries, bringing it down to 4.8% growth in 2014 (the estimate in January was 5.3%). This is the third year in a row that the World Bank has reported a sub 5% growth for middle-income, developing countries. The bank however forecasts that growth could pick up to reach 5.4% in 2015, and could rise a little further to 5.5% in 2016. According to the bank’s estimates, growth in China could be 7.6% in 2014, which marks a slight decline from its January estimates. Wordl Bank group president Jim Yong Kim said that growth rates showed by the developing world are still not enough to create the ideal number of jobs that would positively affect the economically backward 40% people in the world.