The World Bank — citing stagnation in Europe and Japan, and a slowdown in China — downgraded its forecast for the global economy this year. It also reported that world economic growth came in below expectations last year.
The bank predicts the world economy will expand 3 percent this year, up from 2.6 percent last year. In June last year, World Bank economists had forecast 3.4 percent global economic growth this year and 2.8 percent last year.
“The recovery has been sputtering in the euro area and Japan as legacies of the financial crisis linger... China, meanwhile, is undergoing a carefully managed slowdown,” the bank said on Tuesday, in the first of its twice-yearly Global Economic Prospects reports for this year.
Plunging oil prices and stronger growth in the US are expected to help boost global growth this year.
The bank expects the US economy to grow 3.2 percent this year, up from 2.4 percent last year.
Growth among the 19 countries that use the euro is expected to pick up modestly — to 1.1 percent this year from 0.8 percent last year. Likewise, the Japanese economy is expected to rebound to 1.2 percent growth this year from 0.2 percent last year.
The bank expects China’s economy to expand 7.1 percent this year, down from 7.4 percent last year. The slowdown reflects in part the Chinese government’s effort to rein in excessive lending and wasteful investment.
Overall, the bank expects high-income countries to grow 2.2 percent this year, up from 1.8 percent last year. Developing countries will grow 4.8 percent, an improvement from 4.4 percent last year.
The bank sees risks that could spoil its forecast. There is potential for a financial crisis if investors pull money out of emerging markets to take advantage of rising interest rates and improving economic prospects in the US. That could cause emerging market currencies to plummet and squeeze companies that borrowed in US dollars — a partial replay of the Asian financial crisis from 1997 to 1998.
Conflict in Ukraine and the Middle East could disrupt economic growth. The Chinese economy could tumble into a “disorderly slowdown.” Sub-Saharan African economies, expected to grow a healthy 4.6 percent this year, could be devastated instead if the Ebola outbreak is not contained.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day