Transcript No Slide Title

Key Messages
Outlook for developing country growth
improved considerably in the last six months


Momentum of global trade and production
strong; financial and commodity markets
varied


Developing country recovery unlikely to
eclipse pre-crisis trends; prospects differ
markedly across developing regions
Global risks are more balanced (some upside), but oil price a current concern
GDP Growth: Industrial and Developing
Regions, 1995-2002
(percent)
Forecast
5
Developing
Countries
4
World
3
OECD
2
1
1995
1996
1997
1998
1999
Source: World Bank baseline, March 2000.
2000
2001
2002
GDP Growth: G-7 and Developing Countries
(percent year-over-year)
G-7 countries
Developing countries
4.2
4.6
4.5
4.8
3.1
2.4
2000
2.6
2.1
2001
November forecast
2000
Current forecast
Source: DECPG baseline (March 2000) and GEP (November 1999)
2001
Per capita growth distribution by developing
country population
(percentage of developing country population excluding China, India)
< 0%
0-2%
> 2%
80
1.6 billion people
60
140 million people
40
20
0
1996
Source: DECPG baseline, March 2000
1998-99
2000
Convergence of industrial country growth
rates in the early 2000s
(percent)
5
4
North America*
3
2
1
0
Euro Area
Asia-Pacific**
-1
-2
-3
1997
1998
1999
2000
2001
2002
Source: DECPG projections, March 2000. Notes: * North America: United States and Canada;
** Asia-Pacific: Japan, Australia and New Zealand.
U.S. consumer, producer and import prices,
1997-2000
(3-month/3-month annualized change in percent )
15
U.S. import prices
10
Producer prices
5
CPI
0
-5
-10
-15
Jan-97
Jul-97
Jan-98
Source: U.S Bureau of Labor Statistics.
Jul-98
Jan-99
Jul-99
Jan-00
U.S. and Euro-Area short term interest rates,
1997-2000
( percent )
6.5
6
U.S. 3-month CD rate
5.5
5
Fed Funds
4.5
4
Euro-area average
3 month money market
3.5
3
Jan-97
Jul-97
Jan-98
Source: Datastream / Euro-stat..
Jul-98
Jan-99
Jul-99
Jan-00
High-income countries’ import volume growth
(percent, 3 month/3 month, saar)
30
Percent
20
10
OECD
0
-10
Asian NIEs
-20
Q1 97
Q3 97
Q1 98
Q3 98
Source: Datastream and DECPG staff estimates.
Q1 99
Q3 99
Oil and non-oil prices, 1992-2000
(US$/bbl for oil, index 1990=100 for others
$28
140
Non-oil commodities
$25
Oil (lhs)
130
120
$22
110
$19
100
90
$16
80
$13
Metals & minerals
70
$10
60
Jan'92 Jan'93 Jan'94 Jan'95 Jan'96 Jan'97 Jan'98 Jan'99 Jan'00
Source: DECPG, World Bank
Gross capital market flows as a ratio of GDP
and spreads on EMBI
Basis points
percent
1400
Capital Market
Flows/GDP
EMBI
1200
5
4
1000
800
3
600
2
400
1
200
0
0
90
91
92
93
94
95
96
Source: Euromoney, IMF, DECPG staff estimates
97
98
99
2000 2001
GDP Growth: East Asia, Latin America and the
Transition Economies, 1995-2002
(percent)
Forecast
10
East Asia
5
Latin America
0
Transition
Economies
-5
1995
1996
1997
1998
Source: World Bank baseline, March 2000.
1999
2000
2001
2002
GDP Growth: South Asia, MENA
and Sub-Saharan Africa, 1995-2002
(percent)
Forecast
8
South Asia
6
4
2
MENA
Sub-Saharan
Africa
0
1995
1996
1997
1998
Source: World Bank baseline, March 2000.
1999
2000
2001
2002
Global Risks:
Four Transitions
... to a ‘soft landing’ in the United States
... from fiscal stimulus to private-demand led
growth in Japan
... to healthier financial and corporate sectors in
East Asia
... to a medium-term equilibrium price of oil
High Oil price Scenario: GDP Growth for World
Regions
(difference (-) in growth rates from baseline)
G-7
2000
World
2001
EAP
LAC
LMIC
ECA
SSA
SAS
MNA
0
1
Source: DECPG. Simulation of $30/bbl in 2000, $25/bbl in 2001 (Oxford Economics) model.
Results validated against simulations prepared by OECD, JP Morgan and other analysts.
2