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Global Economic Prospects—June 2011

GEP Summer 2011

Washington, June 7, 2011—As they put the financial crisis behind them, developing countries need to focus on tackling country-specific challenges such as achieving balanced growth through structural reforms, coping with inflationary pressures, and dealing with high commodity prices, the World Bank says in its June 2011 edition of Global Economic Prospects.

In contrast, prospects for high-income countries and many of Europe's developing countries remain clouded by crisis-related problems such as high unemployment, household and banking-sector budget consolidation, and concerns over fiscal sustainability among other factors.

The World Bank projects that as developing countries reach full capacity, growth will slow from 7.3 percent in 2010 to around 6.3 percent each year from 2011-2013. High-income countries will see growth slow from 2.7 percent in 2010 to 2.2 percent in 2011 before picking up to 2.7 percent and 2.6 percent in 2012 and 2013 respectively.

"Globally, GDP Measured at 2005 market prices and exchange rates (or 4.8 percent in 2010, 4.3 percent in 2011, 4.4 percent in 2012, and 4.5 percent in 2013 when aggregated using Purchasing Power Parity weights). is expected to grow 3.2 percent in 2011 before edging up to 3.6 percent in 2012," said Justin Yifu Lin, the World Bank's Chief Economist and Senior Vice President for Development Economics. "But further increases in already high oil and food prices could significantly curb economic growth and hurt the poor."

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