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WB urges developing countries to safeguard economic growth, as road ahead remains bumpy

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Jim YongKimFour years after the onset of the global financial crisis, the world economy remains fragile and growth in high-income countries is weak. 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 United States, says the World Bank in the newly-released Global Economic Prospects (GEP) report.

“The economic recovery remains fragile and uncertain, clouding the prospect for rapid improvement and a return to more robust economic growth,” said World Bank Group President Jim Yong Kim. “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.”

Last year 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 percent 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. Developing-country stock markets are up 12.6 percent since June, while equity markets in high-income countries are up by 10.7 percent. However, the real-side of the economy has responded modestly. Output in developing countries has accelerated, but is being held back by weak investment and industrial activity in advanced economies.

“From hopes for a U-shaped recovery, through a W-shaped one, the prognosis for global growth is getting alphabetically challenged. With governments in high-income countries struggling to make fiscal policies more sustainable, developing countries should resist trying to anticipate every fluctuation in developed countries and, instead, ensure that their fiscal and monetary policies are robust and responsive to domestic conditions,” saidKaushik Basu, Senior Vice President and Chief Economist at The World Bank.

The World Bank estimates global GDP grew 2.3 percent in 2012, compared with last June’s expectation of 2.5 percent. Growth is expected to remain broadly unchanged at 2.4 percent growth in 2013, before gradually strengthening to 3.1 percent in 2014 and 3.3[1] percent in 2015. Developing-country GDP is estimated to have grown 5.1 percent in 2012, and is projected to expand by 5.5 percent in 2013, strengthening to 5.7 percent and 5.8 percent in 2014 and 2015, respectively. Growth in high-income countries has been downgraded from earlier forecasts, at 1.3 percent for 2012 and 2013, firming to 2.0 percent in 2014 and 2.3 percent by 2015. Growth in the Euro Area is now projected to only return to positive territory in 2014, with GDP expected to contract by 0.1 percent in 2013, before edging up to 0.9 percent in 2014 and 1.4 percent in 2015. Overall, global trade of goods and services, which grew only 3.5 percent in 2012, is expected to accelerate, expanding by 6.0 percent in 2013 and 7.0 percent by 2015.

“The weakness in high-income countries is dampening developing-country growth, but strong domestic demand and growing South-South economic linkages have underpinned developing country resilience – to the point that, for the second year in a row, developing countries were responsible for more than half of global growth in 2012,” said Hans Timmer, Director, Development Prospects Group, the World Bank.

Downside risks to the global economy include: a stalling of progress on the Euro Area crisis, debt and fiscal issues in the United States, the possibility of a sharp slowing of investment in China, and a disruption in global oil supplies. However, the likelihood of these risks and their potential impacts has diminished, and the possibility of a stronger-than-anticipated recovery in high-income countries has increased.

Although fiscal sustainability in most developing countries is not an issue, government deficits and debt are much higher today than in 2007.

“To assure resilience to downside risks, developing countries need to gradually rebuild depleted fiscal and monetary buffers, and improve social safety nets and food security,”said Andrew Burns, Manager of Global Macroeconomics and lead author of the report.

 

Growth outlooks for each country are available in the full report at : www.worldbank.org/globaloutlook

Source: http://www.worldbank.org/
Foto: wikipedia

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Foreign Affairs Minister Ramona Mănescu: The Strategic Partnership with the US is the central focus of the Romanian diplomacy, while the accession to Schengen remains a priority

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Foreign Affairs Minister Ramona Mănescu said on Thursday that Romania’s accession to Schengen remains a priority of the Romanian diplomacy.

“Evoking the period when I was MEP, I can certainly tell you that (…) all the time both [the European] Parliament and the Commission said Romania was prepared to join Schengen, from a technical and logistical point of view. (…) Practically, we function de facto as a Schengen member state, but de jure we are not regarded as such. Romania doesn’t ask anything but the observance of the Treaty, we are members with full rights, we met our commitments and we seriously continue to meet them, no one can challenge Romania’s contribution to the security space, because we are not talking only about the eastern flank of NATO, we are also talking about EU’s eastern flank,” Ramona Mănescu told Antena 3 private television broadcaster on Thursday, quoted by Agerpres.

She maintained that the Romanian citizens “have all the right to get this well-deserved position of Schengen member state.”

“This is not something we must beg for, or be made a favour. It is provided in the Treaty and it must be observed. (…) I assure you we keep this on the agenda as priority topic, and all bilateral and extended discussions will include the Schengen accession component, we won’t stop from telling our colleagues in the EU that the Romanian citizens have the same rights,” Mănescu underscored, mentioning that, at present, in the Council half of the states support Romania’s accession to the free movement area, and the others oppose.

The Foreign Minister also pointed out that the Strategic Partnership with the US must remain the central focus of the Romanian diplomacy.

She also showed that Romania has the same position towards Russia as NATO and the EU.

“Romania’s position towards Russia starts in the first place from the vicinity we are in, but it is also part of the EU’s position regarding Russia, as we are part of the EU, we must get in line with EU’s stand. I am referring to sanctions, to certain limitations that we have in the dialogue and cooperation with Russia and I am particularly referring to the firm position we have as EU member, which we have always had, of observing the international legislative framework. We don’t ask too much from Russia as an actor on the geopolitical stage if we ask them to respect the international legislative framework. (…) It is the principle which we start from and which we cannot fail to keep not even for Russia, which is here, close to us. We have no reason to make an exception, because nothing is negotiable in this story,” Ramona Mănescu said.

According to the Minister, the relation with Russia represents “a key point in the stability in the area, in securing NATO’s eastern flank, in the manner in which we can further manage the discussions in the Black Sea. “The threats and gestures which Russia has repeatedly done in the Black Sea space, from a military stand, have been sanctioned all the time. (…) Both NATO and the EU have the same discourse. Romania cannot have a different discourse, because it is both part of the EU and NATO, and we are at the Black Sea,” she added.

Mănescu also said that she expected “the energy diplomacy to have its word,” in regards to the resources in the Black Sea.

“Our desire is for a partner such as Exxon to stay here and continue to work together as much and as well as possible. This entails our making some steps in an expected direction. I believe things will settle in the end, enter the right track and I even want to clarify this position shortly and the US partners must be convinced that we’ll be keeping the same line. (…) Mrs PM wants this as well,” Mănescu said.

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Romania has a new Foreign Affairs Minister. Ramona Mănescu took the oath of office

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Ramona Mănescu, Nicolae Moga and Mihai Fifor took the oath of office on Wednesday in the presence of President Klaus Iohannis for the Interior and Foreign Affairs Ministries office, Deputy Prime Minister for implementing Romania’s strategic partnerships office respectively.

The head of state wished success to the new three members of the Dancila Cabinet.

The swearing-in ceremony was attended by Prime Minister Viorica Dancila, ministers, Deputy Speaker of the Deputies’ Chamber Florin Iordache, Government Secretary General Toni Grebla and presidential advisors.

President Klaus Iohannis signed on Wednesday the decrees appointing Nicolae Moga as Interior Minister and Ramona Mănescu as Foreign Affairs Minister, according to a Presidential Administration release.

Through another decree, Mihai Fifor was appointed Deputy Prime Minister for implementing Romania’s strategic partnerships.

Furthermore, Iohannis took note of Carmen Dan’s resignation from the Interior Ministry and signed the decree dismissing Teodor Meleșcanu from the Foreign Affairs Minister office.

Ramona Mănescu is a Romanian politician and lawyer. She was a Member of the European Parliament serving 2007 to 2013 and 2014 to 2019 from the National Liberal Party (till July 2017), active within the European People’s Party group in the European Parliament.

As part of this group she is a member of the European Parliament Committee on Foreign Affairs, vice-chair in the Delegation for relations with the Mashreq countries and a substitute member in the Committee on transport and tourism and in Delegation for relations with the Arab Peninsula.

Between 2007 and 2014 she was part of the ALDE group in the European Parliament, where she also held the position of Vice-President (11 November 2012 – June 2014) of the ALDE Party (Alliance of Liberals and Democrats for Europe Party). As a member of this group she is a coordinator in the Regional Development Committee and a member in the Committee on Employment and Social Affairs.

At the European Parliamentary elections from June 2014, Mănescu renewed her mandate within European Parliament, where she became a member of the European People’s Party group in the Parliament European.

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Romania: President Klaus Iohannis appoints former MEP Ramona Mănescu as the new Foreign Affairs Minister

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President Klaus Iohannis signed on Wednesday the decrees appointing Nicolae Moga as Interior Minister and Ramona Mănescu as Foreign Affairs Minister, according to a Presidential Administration release.

Furthermore, Iohannis took note of Carmen Dan’s resignation from the Interior Ministry and signed the decree dismissing Teodor Melescanu from the Foreign Affairs Minister office.

Through another decree, Mihai Fifor was appointed Deputy Prime Minister for implementing Romania’s strategic partnerships.

The swearing-in ceremony takes place on Wednesday at 11:00hrs, at the Cotroceni Presidential Palace. 

Ramona Mănescu is a Romanian politician and lawyer. She was a Member of the European Parliament serving 2007 to 2013 and 2014 to 2019 from the National Liberal Party (till July 2017), active within the European People’s Party group in the European Parliament.

As part of this group she is a member of the European Parliament Committee on Foreign Affairs, vice-chair in the Delegation for relations with the Mashreq countries and a substitute member in the Committee on transport and tourism and in Delegation for relations with the Arab Peninsula.

Between 2007 and 2014 she was part of the ALDE group in the European Parliament, where she also held the position of Vice-President (11 November 2012 – June 2014) of the ALDE Party (Alliance of Liberals and Democrats for Europe Party). As a member of this group she is a coordinator in the Regional Development Committee and a member in the Committee on Employment and Social Affairs.

At the European Parliamentary elections from June 2014, Mănescu renewed her mandate within European Parliament, where she became a member of the European People’s Party group in the Parliament European.

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