World Bank Report Offers Chilly Forecast For Global Economy
World Bank president Robert Zoellick has issued a chilling report that leaves no doubt that our entire planet is in the midst of a raging Global Economic Crisis. While framed in the context of the impact of the crisis on emerging economies, the overall assessment of the World Bank is what strikes a note of gloom and doom for the few remaining financial optimists. For the first time since the Second World War, the entire planet will be in recession.
Since the Great Depression, the global economy has suffered through numerous recessions, both large and small. Yet, even in a severe recession, there were always parts of the world, and frequently entire regions, that still experienced economic growth. The quantitative manifestation of that reality is that even in prior recessionary periods, the overall GDP of the planet still witnessed net growth, through at a reduced level. That was then; but this is now. Welcome to the super-globalized economy.
In the report issued by the World Bank, the current forecast is for an overall decline in global GDP. The mathematical modeling that leads to this conclusion provides for a devastating negative feedback loop that integrates the decimation of exports from major economies with collateral damage to smaller but equally essential export trade from emerging economies. As Zoellick puts it in the World Bank Report, with the overall World economy shrinking for the first time since the Second World War, ‘‘this global crisis needs a global solution and preventing an economic catastrophe in developing countries is important for global efforts to overcome this crisis.” The World Bank president warns that with global trade witnessing its sharpest decline in 80 years, an additional 46 million people will be forced into poverty.
The sober assessment being offered by the World Bank points out with clarity why this worldwide financial and economic disaster has become the Global Economic Crisis. No one is coming out of this man-made cataclysm intact. Entire countries, powerful and weak, rich and poor, face ruination as the first great economic depression of the 21st century wreaks havoc on our world.