The World Bank has forecast the global economy will contract by 2.9 percent, more than the 1.7 percent as initially predicted.
World Bank economist Justin Lin said governments need to continue their financial stimulus measures to support their weakening economies.
“It is very important to let the stimulus continue until the capacity utilisation returns to a normal level. Otherwise, there is always a danger that unemployment will rise and growth slow down,” he said.
The World Bank forecast also predicted the top two economies, the USA and Japan would contract at a greater rate than initially forecast. The USA would shrink by three percent, and Japan by 6.8 percent, more than the 2.4 percent and 5.3 percent contraction forecast last quarter.
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