South Asia’s regional economic growth is expected to accelerate to 7.1 per cent in 2019, underpinned by strengthening investment and robust consumption, said the World Bank on Tuesday (8).
India is forecast to accelerate to 7.3 per cent in the financial year (FY) 2018-19 as consumption remains robust and investment growth continues, whereas Bangladesh is expected to slow to seven per cent as economic activity is supported by strong private consumption and infrastructure spending.
Pakistan’s growth is projected to decelerate to 3.7 per cent in FY2018-19, with financial conditions tightening to help counter rising inflation and external vulnerabilities.
Sri Lanka is anticipated to speed up slightly to four per cent in 2019, supported by robust domestic demand and investment boosted by infrastructure projects.
Nepal’s post-earthquake momentum is forecast to moderate, and growth should slow to 5.9 per cent in FY2018-19.
The bank added that India will continue to be the fastest growing major economy in the world in 2019.
Global economic growth is projected to soften from a downwardly revised three per cent in 2018 to 2.9 per cent in 2019 amid rising downside risks to the outlook, the World Bank noted. International trade and manufacturing activity have softened, trade tensions remain elevated, and some large emerging markets have experienced substantial financial market pressures.
Growth among advanced economies is forecast to drop to two per cent this year, the January 2019 Global Economic Prospects says. Slowing external demand, rising borrowing costs, and persistent policy uncertainties are expected to weigh on the outlook for the emerging market and developing economies. Growth for this group is anticipated to hold steady at a weaker-than-expected 4.2 per cent this year.
“At the beginning of 2018 the global economy was firing on all cylinders, but it lost speed during the year and the ride could get even bumpier in the year ahead”, said World Bank chief executive officer Kristalina Georgieva.
“As economic and financial headwinds intensify for emerging and developing countries, the world’s progress in reducing extreme poverty could be jeopardised. To keep the momentum, countries need to invest in people, foster inclusive growth, and build resilient societies,” he added.