The World Bank (WB) provided a briefing regarding the state of Eastern European and Central Asian economies before their annual IMF spring meeting. The World Bank's report reinforced most of the Asian Development Bank's (ADB) recent analysis of the current and future state of CA's economy. For instance, the World Bank warns of a coming economic growth slowdown in the region due to downturns in the financial markets of the US and Western Europe. Like the ADB, the WB briefing also focused on rising inflation in CA states and how it was causing food and energy prices to increase beyond the means of many of the region's poor.
The WB recommended "timely measures' of social assistance and public expenditures by the region's governments to soften the landing for the regions poor, who will be the hardest hit during the coming economic downturn. The WB's report is not all bad news. It states that economic growth in the region has been "strong' in recent years and that years of reforms have made the region's economies "resilient' to most financial shocks. However, the report acknowledges that CA state economies still must undergo structural changes to increase their resiliency and efficiency. They urge a tightening of fiscal policy, intensifying banking supervision, and improving the investment environment to help bring in more FDI.
(Source for Photo: World Bank Website)