From: wolda002@umn.edu
Date: Wed May 26 2010 - 03:05:49 EDT
Look and learn from developing world - Zoellick
Mon, May 24 2010
LONDON, May 25 (Reuters) - The world's developed nations should follow the
example of the developing word and boost growth if they are to avoid a
"lost decade," World Bank chief Robert Zoellick said in a newspaper column
published on Tuesday.
Writing in the Financial Times Zoellick urged leaders of developed nations
to take note of developing countries who are introducing regulatory reforms
to encourage private sector growth and ensure a stable recovery.
"They (developed countries) need to seize opportunities from growth in
developing countries to avoid their own lost decade."
"Last year as developed economies focused on Keynesian changes in demand,
Asia-Pacific economies were advancing reforms especially in services to
generate higher growth," Zoellick wrote.
"As developed economies focused on financial regulation and a broader
regulatory movement, Asians were considering how deregulation might foster
innovation and jobs," he added.
The World bank has forecast growth in developing countries of about 6
percent this year and next -- more than double that of high-income nations.
Zoellick pointed to countries throughout the developing world that have
improved their growth prospects by investing in infrastructure to raise
productivity.
According to a World Bank study of 4,000 Indian companies, reforms in
banking, telecoms and transport have helped improve productivity, Zoellnick
said.
"To avoid a decade-long work-out with political and economic risks the
world needs stronger growth in developing and developed countries. We are
seeing a shift towards a new multi-polar global economy, with better
prospects in developing countries than in developed ones," he wrote.
Zoellick urged European policymakers, currently battling a debt crisis, to
look to the developing world to make sure they learn the correct lesson
from the financial crisis.
"The 750 billion euro package to defend the euro buys time. But it is not
enough. So far, the world has focused on fiscal contraction and debt, but
these are only half the story," Zoellick wrote.
"The world and Europe also need a return to robust growth. Without it the
fiscal adjustments will be more painful and the politics more
unmanageable." (Reporting by Caroline Copley; Editing by Carol Bishopric)
(caroline.copley@thomsonreuters.com; +44 20 7542 7939))
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