Outlook summary
After four years of robust GDP and trade growth, conditions in global financial markets have turned from favorable to less stable and less predictable. Global GDP growth eased to 3.6 percent in 2007 from 3.9 percent in the preceding year, and gains will moderate further in 2008, led by the high-income countries. Importantly, developing countries should provide a modicum of support for trade, such that more adverse global GDP outturns are avoided. More... Forecast summary
A table summarizing the forecast. More detailed information is available here. Financial markets
The financial turbulence that emerged in summer 2007 has demonstrated how sudden and pervasive adjustments in financial markets can be. But capital flows to developing countries have helped to soften effects of the market disruptions. Emerging markets have rebounded and are out-pacing gains in mature markets. More... Global growth
Developing economies grew 7.4 percent in 2007— while world growth eased to 3.6 percent. Global growth is expected to slow further in 2008, as the effective cost of capital remains elevated for financial institutions, firms, and households, but an upturn is projected in 2009. More... World trade
World trade volumes continue to advance, with an average increase of 6.7 percent over the last seven years, registering a robust 8.7 percent gain in 2007. Looking forward, continued robust demand across developing countries is likely to offset easing import growth in the U.S. and other high-income countries. More... Inflation and commodity markets
In high-income countries, inflationary pressures were sufficiently under control during 2007 to allow central banks to end a period of monetary tightening. Although inflation conditions across the developing countries are varied, only two regions are experiencing acceleration in CPI, while hyperinflation has been eliminated. More... Risks
Substantially tighter financial conditions could generate a true ‘credit crunch’ that would carry serious consequences for investment and growth in middle income countries. Effects on low-income countries would also be substantial due to weaker global demand for commodities, price declines and terms of trade losses. More... Long-term prospects and poverty forecasts
Per capita income growth in developing countries continues to be robust, and this may be expected to continue over the longer term–real incomes may double by 2020. There have been rapid improvements in reducing poverty in Asia, and projections imply some improvement for Sub-Saharan Africa, but still below target. More... Regional outlooks
Growth across developing regions is expected to slow moderately in 2008. More... |
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