WB lowers projection for 2014 global economic outlook

WASHINGTON - The World Bank on Tuesday lowered its projection for this year's global economic outlook, as developing countries are heading for "disappointing growth," while high-income countries are gaining momentum.

The Washington-based bank forecasts the global economy to grow 2.8 percent this year, down from its January estimate of 3.2 percent, according to its twice-yearly Global Economic Prospects report.

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"Developing countries are headed for a year of disappointing growth, as first quarter weakness in 2014 has delayed an expected pick-up in economic activity," the report noted.

Bad weather in the United States, the crisis in Ukraine, rebalancing in China and political strife in several middle-income economies slow progress on structural reform, it said.

The bank has lowered its forecasts for developing countries to a growth of 4.8 percent this year, down from its January estimate of 5.3 percent, the third year in a row of below five percent growth for developing countries. Growth is forecast to pick up to 5.4 percent in 2015 and 5.5 percent in 2016.

China is expected to grow 7.6 percent this year, slightly down from its January estimate of 7.7 percent, but this will depend on the success of rebalancing efforts, the bank said. "If a hard landing occurs, the reverberations across Asia would be widely felt," it noted.

"Growth rates in the developing world remain far too modest to create the kind of jobs we need to improve the lives of the poorest 40 percent," said World Bank Group President Jim Yong Kim.

"Clearly, countries need to move faster and invest more in domestic structural reforms to get broad-based economic growth to levels needed to end extreme poverty in our generation," he said.