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World Bank cuts 2016 global growth estimate to 3.1 pct

All News 05:00 June 08, 2016

SEJONG, June 8 (Yonhap) -- The World Bank on Wednesday cut its 2016 growth estimate of the global economy by 0.5 percentage point to 3.1 percent, citing a slowdown in emerging countries and a drop in commodities prices.

For 2017, the organization also revised down the forecast to 3.6 percent from 3.8 percent projected in January, according to the World Bank's latest report of the Global Economic Prospects that was released by the Ministry of Strategy and Finance here.

Against the backdrop, advanced countries are expected to see their economy edge up an average 1.7 percent this year, down from a 2.2 percent growth outlook by the World Bank five months earlier.

The report slashed growth estimates for the United States by 0.8 percentage point to 1.7 percent, while the eurozone is forecast to grow 1.6 percent.

Emerging countries also received a 0.6 percentage-point downgrade to 3.5 percent, with China expected to expand 6.7 percent and India 7.6 percent.

The study said the world economy will likely face difficulty in making a turnaround as emerging economies and world trade are slowing down amid falling crude oil prices.

Other downside risks like financial uncertainties in the global market and possible geopolitical tensions will also weigh heavily on the world economy.

The World Bank noted that a protracted slump in advanced economies and a drop in the growth potential of emerging countries may fuel rising protectionism in world trade.


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