For 2015, the bank forecasts a slightly higher economic growth, at 2.7%, which is, however, lower than in the past edition of the report.
On the other hand, the bank upped its figures for 2013 and 2014, which are currently higher than the official estimates of the Romanian government and the International Monetary Fund, of some 2.2% for both years.
Last year’s edition of the Global Economic Prospects predicted economic growth of 1.6% in 2013, followed by 2.2% in 2014, and 3% in 2015.
The World Bank projects the global growth to accelerate to 3.2% this year, from 2.4% in 2013, firming further to 3.4% and 3.5% in 2015 and 2016, respectively. “Much of the initial acceleration will reflect a pick-up in high-income country growth, which after years of extreme weakness and outright recessions, appear to be finally emerging from the global financial crisis,” the bank said.
It said the growth in developing countries is firming, but warned that an abrupt reduction in central banks’ quantitative easing programs could severely impact the developing economies. “In such a scenario, flows to developing countries could weaken sharply, as they did in the summer of 2013. Private capital inflows to developing countries could decline by 50% or more for several months,” which would dampen growth, the bank said.
However, the World Bank projects the withdrawal of quantitative easing in the United States to follow a relatively orderly trajectory, leadfing to just a minor increase in global interest rates. Thus, the “impact of an orderly tightening of financial conditions on developing-country investment and growth is expected to be modest.”