Trade, manufacturing to boost 2017 global growth: World Bank

Advanced economies are showing signs of improvement; emerging markets driving growth

The World Bank on Sunday maintained its forecast that global growth will improve to 2.7 per cent this year, citing a pickup in manufacturing and trade, improved market confidence and a recovery in commodity prices.

The update of the multilateral development lender’s Global Economic Prospects report marked the first time in several years that its June forecasts were not reduced from those published in January due to rising growth risks.

The World Bank’s 2017 global growth forecast of 2.7 per cent compares to its 2.4 per cent estimate for 2016, a figure that was increased by a tenth of a percentage point since January.

The World Bank said advanced economies were showing signs of improvement, especially Japan and Europe, while the seven largest emerging markets — China, Brazil, Mexico, India, Indonesia, Turkey and Russia — were again helping to drive global growth.

“With a fragile but real recovery now under way, countries should seize this moment to undertake institutional and market reforms that can attract private investment to help sustain growth in the long term,” World Bank President Jim Yong Kim said in a statement.

The bank boosted its 2017 growth forecast for Japan by 0.6 percentage point since January to 1.5 per cent, while the euro zone’s forecast was increased by 0.2 percentage point to 1.7 per cent. In both cases, a pickup in exports and unconventional monetary easing are helping to support growth.