Home / Knowledge / News / Textiles / Global economy to expand 3.1% in 2018: World Bank
Global economy to expand 3.1% in 2018: World Bank
06
Jun '18
Global economy to expand 3.1% in 2018: World Bank
Despite recent softening, global economic growth will remain robust at 3.1 per cent in 2018 before slowing gradually over the next two years, the World Bank has said. In 2019 and 2020, the bank foresees advanced-economy growth decelerating and levelling-off the recovery in major commodity-exporting emerging market and developing economies.

Activity in advanced economies is expected to grow 2.2 per cent in 2018 before easing to a 2 per cent rate of expansion next year, as central banks gradually remove monetary stimulus, the June 2018 Global Economic Prospects, released by the World Bank, says. Growth in emerging market and developing economies overall is projected to strengthen to 4.5 per cent in 2018, before reaching 4.7 per cent in 2019 as the recovery in commodity exports matures and commodity prices level off following this year’s increase.

“If it can be sustained, the robust economic growth that we have seen this year could help lift millions out of poverty, particularly in the fast-growing economies of South Asia,” World Bank Group president Jim Yong Kim said. “But growth alone won’t be enough to address pockets of extreme poverty in other parts of the world. Policymakers need to focus on ways to support growth over the longer run—by boosting productivity and labour force participation—in order to accelerate progress toward ending poverty and boosting shared prosperity.”

However, the projected outlook is subject to considerable downside risks. “The possibility of disorderly financial market volatility has increased, and the vulnerability of some emerging market and developing economies to such disruption has risen. Trade protectionist sentiment has also mounted, while policy uncertainty and geopolitical risks remain elevated,” the report said.

A Special Focus (in the report) cautions that over the long run, the anticipated slowdown in global commodity demand could put a cap on commodity price prospects and thus on future growth in commodity-exporting countries. Major emerging markets have accounted for a substantial share of the increase in global consumption of metals and energy over the past two decades, but growth of their demand for most commodities is expected to decelerate, the Special Focus section says.

“The projected decline in commodities’ consumption growth over the long run could create challenges for the two-thirds of developing countries that depend on commodity exports for revenues,” said World Bank senior director for Development Economics, Shantayanan Devarajan. “This reinforces the need for economic diversification and for strengthening fiscal and monetary frameworks.”

Another Special Focus finds that elevated corporate debt can heighten financial stability concerns and weigh on investment. Corporate debt—and, in some countries, foreign currency debt—has risen rapidly since the global financial crisis, making them more vulnerable to rising borrowing costs.

“Policymakers in emerging market and developing economies need to be prepared to cope with possible bouts of financial market volatility as advanced-economy monetary policy normalisation gets into high gear,” said World Bank Development Economics Prospects director Ayhan Kose. “Rising debt levels make countries more vulnerable to higher interest rates. This underlines the importance of rebuilding buffers against financial shocks.”

After many years of downgrades, consensus forecasts for long-term growth have stabilised, a possible signal the global economy is finally emerging from the shadow of the financial crisis a decade ago. However, long-term consensus forecasts are historically overly optimistic and may have overlooked weakening potential growth and structural drags on economic activity, the report cautions.

The report urges policymakers to implement reforms that lift long-term growth prospects. A rapidly changing technological landscape highlights the importance of supporting skill acquisition and boosting competitiveness and trade openness. Improving basic numeracy and literacy could yield substantial development dividends. Finally, promoting comprehensive trade agreements can bolster growth prospects, the report said. (RKS)

Fibre2Fashion News Desk – India


Must ReadView All

UK Govt, fashion retailers sign agreement to fight slavery

Fashion | On 17th Nov 2018

UK Govt, fashion retailers sign agreement to fight slavery

John Lewis, M&S, New Look, NEXT, River Island and Shop Direct...

CNTAC delegation from China visits Pakistan

Textiles | On 17th Nov 2018

CNTAC delegation from China visits Pakistan

Chinese investors have expressed a desire to enter into joint...

Odisha to set up three textile parks

Textiles | On 17th Nov 2018

Odisha to set up three textile parks

Around 17 firms have expressed interest to invest to the tune of ₹589 ...

Interviews View All

Nitin Bhatia, Trend Arrest

Nitin Bhatia
Trend Arrest

Setting up a brand for online selling is easy, but running the brand is not

Top executives, Retailers

Top executives
Retailers

Weak rupee breeds inflation

Nuno Venda, ROQ

Nuno Venda
ROQ

‘There has been an increase in demand for water based inks, rather than...

Nitesh Mittal,

Nitesh Mittal

Kusumgar Corporates is a leading manufacturer of technical textiles and...

Fan Liyuan,

Fan Liyuan

Chinese company Jiangsu Yingyang Nonwoven Machinery, established in 1993,...

Umang Banthia,

Umang Banthia

Established in 2005, SL Banthia Textiles manufactures coated fabrics....

Georg Reinhold, Trützschler  Nonwovens & Man-Made Fibers

Georg Reinhold
Trützschler Nonwovens & Man-Made Fibers

Trützschler Nonwovens & Man-Made Fibers, a part of the Trützschler Group,...

Karl Zelik, Vanderbilt University

Karl Zelik
Vanderbilt University

A team of engineers at the Vanderbilt University has designed a smart...

Kevin Nelson, TissueGen

Kevin Nelson
TissueGen

Kevin Nelson, Chief Scientific Officer, TissueGen discusses the growing...

Nisha Chanda, Whistling Woods International School of Fashion

Nisha Chanda
Whistling Woods International School of Fashion

<div>A lack of upgraded courses in costume designing and fashion as per...

Amiben Shroff, Shrujan

Amiben Shroff
Shrujan

From its modest beginning in the late 1960s, Shrujan has grown into a...

Mike Hoffman, Gildan Activewear SRL

Mike Hoffman
Gildan Activewear SRL

Gildan Activewear, a manufacturer and marketer of branded clothing and...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

Leave your Comments


November 2018

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category


Related Categories:

Advanced Search