Bank Downgrades Global Growth for 2016 – Commodity Exporters are Expected to Grow 5.4% Less than Importers
The World Bank released its economic growth outlook for 2016 Tuesday, reducing its expectations from earlier this year. The bank anticipates global economic growth of 2.4%, down from 2.9% in January. 40% of that downward revision is due to commodity-exporting emerging markets and developing economies which are “[struggling] to adapt to lower prices for oil and other key commodities,” the bank said.
Emerging markets and developing economies are forecast to grow by 3.5% this year, slightly below average. Within that group, however, growth trends vary greatly depending on whether or not the country is a commodity importer or exporter. Importers are expected to see steady growth of 5.8%, but exporters struggling with low commodity prices are forecast to grow just 0.4% in 2016.
Also adding to the downgraded global growth in the World Bank’s most recent forecast are sluggish growth in advanced economies, weak global trade, and diminishing capital flows.
