The contracted global economy is literary palpable with unemployment numbers going through the roof.
The World Bank recently projected that the global economy will shrink in 2009, with growth in the developing markets dropping from 4.4% to 2.1%. They also project that recovery will commence in 2010 albeit at a slowed pace.
What’s more interesting is that the recovery depends on where in the world you live:
A curious note is that the most substantial GDP growth is registered in the emerging markets, especially in Asia.
In this coming fiscal year, developing countries around the globe could potentially face a huge gap in financing which would in turn deal a blow to infrastructure development and poverty alleviation initiatives.
According to the World Bank,
Developing countries face a financing shortfall of $270-700 billion this year, as private sector creditors shun emerging markets, and only one quarter of the most vulnerable countries have the resources to prevent a rise in poverty
This is especially grim news for many African governments that rely on Direct Budgetary Support from the WB, IMF and other private donor institutions to run government programs and payroll. According to UNCTAD, it represents about 30% of central government spending in countries of Sub-Saharan Africa. Continue reading