‘Financial crisis appears to be over’

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Although the global economy remains fragile, the worst of the global financial crisis appears to be over, the World Bank said Tuesday in its Global Economic Prospects report.

The report estimates global gross domestic product (GDP) grew 2.3 per cent in 2012, and it projected GDP growth in the current year to remain mostly unchanged at 2.4 per cent. It will gradually strengthen to 3.1 per cent in 2014 and 3.3 per cent in 2015, the World Bank report said.

Volatility and slow growth in high-income countries are contributing to the fragile state of the global economy, the report says.

It notes that prospects for economic growth in the developing world remain solid, but will be between 1 and 2 percentage points slower than in the pre-crisis period.

Growth among developing countries is projected to be 5.5 per cent in 2013 and in high-income countries 1.3 per cent.

Growth should strengthen to 5.7 per cent and 5.8 per cent in 2014 and 2015, respectively, in developing countries, and to 2 per cent in 2014 and 2.3 per cent by 2015 in high-income countries.

In the eurozone growth is projected to return to positive territory in 2014.

GDP is expected to contract by 0.1 per cent in 2013, before edging up to 0.9 per cent in 2014 and 1.4 per cent in 2015, according to the outlook.

Global trade of goods and services, another measurement highlighted in the report, grew only 3.5 per cent in 2012.

It is expected to accelerate in 2013 to 6 per cent in 2014 and 7 per cent in 2015.

The report also notes that “downside risks” persist.

These include a stalling of progress on the eurozone crisis, debt and fiscal issues in the United States, the possibility of a sharp slowing of investment in China and a disruption in global oil supplies. - Sapa-dpa

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