Global economy will shrink in 2009: World Bank
Washington, Mar 9: The World Bank predicts that the global economy and global trade volume both would shrink in 2009 for the first time since World War II adding to the woes of recession. The new report by the World Bank states that the crisis which began with junk mortgages in the United States of America will create havoc in the poor nations that has nothing to do with the original cause.
The developing nations will face a finance shortfall of $270-700 billion in 2009, as private sector creditors are avoiding emerging markets and only a quarter of most vulnerable countries have the resources to prevent a rise in poverty. World Bank report says that 94 out of 116 developing countries have experienced a slowdown in economic growth. Of these countries, 43 have high levels of poverty.
The most affected sectors are export, construction, mining and manufacturing. It noted that more than half a million jobs have been lost in last 3 months of 2008 in India, specially in gems, jewellery, automobile and textile industry.
Robert B Zoellick, World Bank Group President said, "We need to react in real time to a growing crisis that is hurting people in developing countries." He added that the global recession needs a global solution and preventing an economic disaster in developing nations is important for global efforts to over come the present crisis.