World Bank Says Global Economic Recession to Deepen (Timothy R. Homan)

  June 22 (Bloomberg) -- The World Bank said the global recession this year will be deeper than it predicted in March and warned that a flight of capital from developing nations will swell the ranks of the poor and the unemployed.

  The world economy will contract 2.9 percent, compared with a previous forecast of a 1.7 percent decline, the Washington- based lender said in a report today. Growth will be 2 percent next year, down from a 2.3 percent prediction, the bank said.

  The bank, formed after World War II to fund health and development projects in poor countries, said that while a global recovery may begin this year, impoverished economies will lag behind rich nations in benefiting. The lender called for “bold” actions to hasten a rebound and said the prospects for securing aid for the poorest countries were “bleak.”

  “The recovery is not going to be V-shaped,” said Alvin Liew, an economist at Standard Chartered Bank in Singapore. “We may see slower consumer demand over a prolonged period.”

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