Washington: By 2025,
India and five other major emerging economies - Brazil, China,
Indonesia, South Korea, and Russia - will account for more than
half of all global growth, a new World Bank report says.
As a result, the international monetary system will likely no
longer be dominated by a single currency, the report, Global
Development Horizons 2011-Multipolarity: The New Global Economy,
released Tuesday suggests.
As economic power shifts, these successful economies will help
drive growth in lower income countries through cross-border
commercial and financial transactions, it said.
To sustain growth and cope with more complex risks, economies that
are home to emerging growth poles need to reform domestic their
institutions, including in the economic, financial and social
sectors, the report said.
China, Indonesia, India, and Russia all face institutional and
governance challenges. Human capital and ensuring access to
education is a concern in some potential growth poles,
particularly Brazil, India and Indonesia, it said.
The report projects that as a group, emerging economies will grow
on average by 4.7 percent a year between 2011 and 2025.
Advanced economies, meanwhile, are forecast to grow by 2.3 percent
over the same period, yet will remain prominent in the global
economy, with the euro area, Japan, Britain and the United States
all playing a core role in fuelling global growth.
"The fast rise of emerging economies has driven a shift whereby
the centres of economic growth are distributed across developed
and developing economies - it's a truly multipolar world," said
Justin Yifu Lin, the World Bank's chief economist and senior vice
president for development economics.
"Over the next decade or so, China's size and the rapid
globalization of its corporations and banks will likely mean a
more important role for the renminbi," said Mansoor Dailami, lead
author of the report and manager of emerging trends at the World
"The most likely global currency scenario in 2025 will be a
multi-currency one centered around the dollar, the euro, and the
(Arun Kumar can be contacted at firstname.lastname@example.org)