World Bank experts predict global economic activity will grow a bit faster this year because of more rapid growth in advanced economies, a study published Wednesday said.
While developed nations are expanding, global growth is constrained by problems in major emerging markets, the study said.
The study said that overall, the global economy would probably expand at a 2.9 percent annual pace this year, up about half a percentage point from 2015.
The authors said weakness in most major emerging markets was a concern, because those nations have been “powerful contributors to global growth for the past decade.”
“More than 40 percent of the world’s poor live in developing nations where growth slowed in 2015,” World Bank President Jim Yong Kim said.
Growth in emerging nations was hurt last year as prices fell for their commodity exports, including oil.
These developing economies are forecast to expand by 4.8 percent this year, which is a little faster than in 2015. Growth is expected to slow further in China, while Russia and Brazil are expected to remain in recession for the year.
Previously, strong growth in emerging nations attracted lots of investment that helped them expand businesses and infrastructure. However, slowing growth and rising risk are now encouraging investors to move their money to the perceived safety of advanced nations.
The outflow of capital from emerging markets is also encouraged by rising interest rates in the United States, which investors expect will improve their profits.