Global economic growth is projected to soften from a downwardly revised 3% in 2018 to 2.9% in 2019 amid rising downside risks to the outlook, the World Bank said on Tuesday. 

International trade and manufacturing activity have softened, trade tensions remain elevated, and some large emerging markets have experienced substantial financial market pressures.

Growth among advanced economies is forecast to drop to 2% this year, the January 2019 Global Economic Prospects says. Slowing external demand, rising borrowing costs, and persistent policy uncertainties are expected to weigh on the outlook for emerging market and developing economies. Growth for this group is anticipated to hold steady at a weaker-than-expected 4.2% this year.

“At the beginning of 2018 the global economy was firing on all cylinders, but it lost speed during the year and the ride could get even bumpier in the year ahead”, said World Bank Chief Executive Officer Kristalina Georgieva. 

“As economic and financial headwinds intensify for emerging and developing countries, the world’s progress in reducing extreme poverty could be jeopardized. To keep the momentum, countries need to invest in people, foster inclusive growth, and build resilient societies,” she added.

Europe and Central Asia

The lingering effects of financial stress in Turkey are anticipated to weigh on regional growth this year, slowing it to 2.3% in 2019. Turkey is forecast to experience weak activity and slow to a 1.6% pace due to high inflation, high interest rates, and low confidence, dampening consumption and investment. Growth in the western part of the region, excluding Turkey, is projected to slow. Poland is anticipated to slow to 4% as Euro Area growth slows. Growth in the eastern part of the region is also anticipated to slow as large economies including Russia, Kazakhstan, and Ukraine decelerate.

Uzbekistan

The World Bank's forecast for Uzbekistan remained unchanged from the previous report in June - the growth rate of the Uzbek economy is expected to be 5.1% in 2019, 5.5% in 2020 and 6% in 2021.

This is one of the best indicators in Europe and Central Asia. The growth rate of Kazakhstan’s economy, for example, will drop from 3.5% in 2019 to 3.2% by 2021.

Earlier, the World Bank predicted a decline in oil prices.