World Bank tells India to safeguard economic growth
Developing countries need to focus on raising the growth potential of their economies, while strengthening buffers to deal with risks from the euro area and fiscal policy in the US, the Bank said in its latest report Global Economic Prospects (GEP), which was released on Tuesday.
"The economic recovery remains fragile and uncertain, clouding the prospect for rapid improvement and a return to more robust economic growth," World Bank Group President Jim Yong Kim said.
"Developing countries have remained remarkably resilient thus far. But we can't wait for a return to growth in the high-income countries, so we have to continue to support
developing countries in making investments in infrastructure, in health, in education.
This will set the stage for the stronger growth that we know that they can achieve in the future," he said.
According to the World Bank report in 2012, developing countries recorded among their slowest economic growth rates of the past decade, partly because of the heightened euro area uncertainty in May and June of 2012.
Since then, financial market conditions have improved dramatically.
International capital flows to developing countries, which fell 30 per cent in the second quarter of 2012, have recovered and bond spreads have declined to below their long-term average levels of around 282 basis points, it said.
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