Most Developing Countries Likely to Be on Edge of Break, Says WB Head
Azerbaijan, Baku, 15 October / Trend corr. N.Ismayilova / The head of the World Bank (WB) urged the world community to modernize markets and market mechanisms in line with new global economy.
"As the United States and whole world seek to get out the current situation, now it is necessary for us to think of future," Robert Zellik, the head of the World Bank (WB) Group said at an annual conference of the International Monetary Fund (IMF) and WB in Washington.
According to Zellik, developing countries with emerging economy form new poles of the economic growth, which enable to restore them and open new opportunities, while it is a nutrient medium for people spreading panic.
"Owing to its interaction with global economy, these developing economic centers (developing countries) have become interested sides of the global system, whose profits they used. They want to specify their role in development of new rules for functioning of the world economy," Zellik said.
In October, most developing countries can be on the edge of break, Zellik said. Reduction of export amounts and capital influx will cause sharp cut in investment. Slowdown of rates of the economic growth and worsening of financing conditions will provoke bankruptcy of enterprises and raise risks of emergency situation at the banking system.
"Some countries will face danger of crisis of balance of payments. As usual, the poorest country will be the most defenseless amongst these countries," Zellik said.
According to the WB head, a new multilateral market mechanism should create a sense of general responsibility for health and efficient functioning of the world economy. It means, first of all, that the sides of the mechanism should comprise countries, which control heavy party of economy and are prepared not only to reap the fruits of maintenance of the world economic order, but also to divide responsibility for its maintenance.
"We should give a new definition to multilateral economic mechanism without restricting traditional orientation on finance and trade," Zellik said.
The correspondent can be contacted at [email protected]