World Bank expects Brazil's economy to shrink 2.5% in 2016
After severe recession in 2015, Brazil's economy will continue to shrink this year, the World Bank said in its Global Economic Prospects report released Thursday (Jan. 6). A 2.5% GDP contraction is expected. For 2015, the organization projected a 3.7% decline.
Last year, the World Bank had projected Brazil's economy would shrink 1,3% in 2015 and grow 1.1% this year. According to their projections, an upturn will only come in the next two years, with an estimated growth of 1.4% in 2017 and 1.5% in 2018.
About emerging countries more generally, there will be varying performances this year, with some economies recovering faster than others. "There is greater divergence in performance among emerging economies. Compared to six months ago, risks have increased, particularly those associated with the possibility of a disorderly slowdown in a major emerging economy. A combination of fiscal and central bank policies can be helpful in mitigating these risks and ing growth,” said World Bank Group Vice President Kaushik Basu.
Among BRIC countries, only Brazil and Russia will face recession this year according to the World Bank. The report noted that India came to the forefront of global economic growth, and has been estimated to expand 7.3% in 2015, 7.8% this year, and 7.9% in 2017 and 2018. With a slowing economy, China slipped to second place with 6.9% growth in 2015, 6.7% in 2016, and 6.5% in the next two years.
The slow recovery of emerging markets will be a significant influence on the world's growth in 2016, with global estimates revised from 3.3% to 2.9%. This projection, however, is an improvement from the 2.4% projected for 2015, reflecting a recovery in advanced countries, whose effects are beginning to be felt and influence the world economy.
Translated by Mayra Borges
Fonte: World Bank expects Brazil's economy to shrink 2.5% in 2016
