WASHINGTON, January 10. /TASS/. Global economic growth will reach 3.1% in 2018 and slightly moderate later, the World Bank said in its January report named ‘Broad-Based Upturn, but for How Long?’ released on Tuesday.
"While global growth is forecast to edge up to 3.1% in 2018, it is projected to slightly moderate later in the forecast horizon, given the anticipated normalization of monetary policy in major advanced economies in the face of closing output gaps, an expected slowing of growth in China, and limited medium term prospects for substantial further acceleration among commodity-exporting EMDEs," the report said.
Major risks include the possibility of disorderly financial market movements, unexpected policy changes, rising trade protectionism, heightened geopolitical tensions, and, over the longer run, a sharper-than-expected slowdown in potential output growth.
The World Bank’s analysts expect advanced-economy growth to moderate slightly to 2.2% in 2018 and to average 1.8% in 2019-20 - "close to the upper bound of potential growth estimates," the report said. "This path reflects the unwinding of a cyclical upturn in investment and further normalization of monetary policy," the paper said.
"EMDE growth is projected to further strengthen to 4.5% in 2018 and to an average of 4.7% in 2019-20 - close to potential - as headwinds to commodity exporters dissipate. However, potential growth over the next decade is likely to decline, reflecting the lagged effect of recent investment weakness, slowing productivity growth, and unfavorable demographic trends," the report said.