The world economy is poised to grow by 2.7 per cent this year, the World Bank has said while adding that trade and manufacturing will be the driving forces behind the growth.
The strength of manufacturing and trade will improve market confidence as well as commodity pricing thereby driving global growth, the World Bank has said. The update of the multilateral development lender’s Global Economic Prospects report marked the first time in several years that its June forecasts were not reduced from those published in January due to rising growth risks.
The World Bank’s 2017 global growth forecast of 2.7 per cent compares to its 2.4 per cent estimate for 2016, a figure that was increased by a tenth of a percentage point since January.
According to the global bank, Japan and Europe are showing signs of improvement, while the seven largest emerging markets — China, Brazil, Mexico, India, Indonesia, Turkey and Russia — were again helping to drive global growth.
“With a fragile but real recovery now under way, countries should seize this moment to undertake institutional and market reforms that can attract private investment to help sustain growth in the long term,” World Bank President Jim Yong Kim said in a statement.
The bank boosted its 2017 growth forecast for Japan by 0.6 percentage point since January to 1.5 per cent, while the euro zone’s forecast was increased by 0.2 percentage point to 1.7 per cent. In both cases, a pickup in exports and unconventional monetary easing are helping to support growth.