World Bank to experience more disturbances in economic growth 2016

The latest report from the World Bank has suggested that the slowing economic growth in major developing markets will pose adverse effects on overall global expansion in 2016.

The World Bank’s “January 2016 Global Economic Prospects” report published on Wednesday has claimed that the advanced economies of the world will have sole responsibility in reaping considerable enhancements in the global economic activity. The bank reduced its global expansion in 2016 from June forecast by 0.4 percent, making it 2.9 percent. This is more than 2.4 percent as recorded in 2015. The growth is remarkable as it appeared in a situation where market economies are constantly weakening.

The World Bank has considered Chinese and Brazilian markets as main factors as based on their slow paced growth, the bank has slashed its growth forecast for the 2016 global economy. "Simultaneous weakness in most major emerging markets is a concern for achieving the goals of poverty reduction and shared prosperity because those countries have been powerful contributors to global growth for the past decade,” the World Bank report stated.

The global economic growth was less than expected in 2015 despite reduced commodity prices, episodes of financial volatility and flagging trade, as the report suggested. The growth record in 2016 will completely be based upon how developed economies will perform. “Firmer growth ahead will depend on continued momentum in high-income countries, the stabilisation of commodity prices, and China’s gradual transition towards a more consumption and services-based growth model,” the report read.

The bank’s review report has even more drastic predictions for the two major economies already in recession. Brazil’s fall might result in decline from 3.6 percent to 2.5 percent, while Russia down from 1.4 percent to 0.7 percent contraction. The World Bank chief economist Kaushik Basu said that in comparison to six months ago, risks relating to emerging economies have increased. This seems true mostly for those who are experiencing huge slowdown in global economic growth rate, he said.