World Bank Group new study indicated that developing countries can expect growth in the New Year as soft oil prices, a stronger United States economy and continued low global interest rates help fuel their recovery.
The biannual Global Economic Prospects report on Wednesday projected a global economic expansion of three percent for 2015, 3.3 percent for 2016 and 3.2 percent in 2017.
The report added that developing countries are expected to rush from last year’s 4.4 percent growth to 4.8 percent in 2015 and strengthen to a more robust 5.4 percent by 2017.
World Bank President Jim Yong Kim called on developing countries to carefully deploy their resources to support social programs focusing on the poor and undertake structural reforms that invest in people.
He added that it is critical for countries to remove unnecessary roadblocks for private sector investment which is the greatest source of jobs that can lift hundreds of millions of people out of poverty.
World Bank Chief Economist and Senior Vice President Kaushik Basu cautioned that the stalled recovery in some high-income economies and middle-income countries may be a symptom of deeper structural dissatisfaction.
He said the lower oil price which is expected to persist through 2015 is lowering inflation worldwide and is likely to delay interest rate hikes in rich countries, creating a window of opportunity for oil-importing countries, such as China and India.
World Bank Director of Development Ayhan Kose said ‘lower oil prices will lead to sizeable real income shifts from oil-exporting to oil-importing developing countries’.