The World Bank has made a sharp downward revision of Mozambique’s economic growth forecast this year to 3.2 percent of GDP, a cut of 2.9 percentage points from June’s forecast.

“The costs of servicing debt remained unsustainable in Mozambique and Chad, stressing the need for governments in this and other low-income countries to continue their efforts to mobilise domestic revenue and rationalise public spending,” write World Bank experts in the Global Economic Prospects report.

In the document, released on Tuesday evening in Washington, experts say that Mozambique grew 3.1 percent in 2017, and will grow 3.2 percent this year and 3.4 percent in the next two years, representing a downward revision of 1.7 points to 2017 and 3.3 percentage points to the 2020 growth forecast made in June.

The report makes several references to Mozambique, highlighting the high public debt and the strengthening of the metical due to the increase in exports.

With regard to the African continent, the World Bank says that a modest recovery is underway, supported by an improvement in commodity prices, namely oil.

“Although economic growth has increased in Angola, Nigeria and South Africa, the region’s three largest economies, growth remains low,” the report’s drafters add, noting that “the region should see a rise in [economic] activity over the forecast horizon, based on the consolidation of raw material prices and the gradual strengthening of domestic demand”.

The World Bank predicts growth in 2017 has reached 2.4 percent, after a sharp slowdown to 1.3 percent in 2016, and for this year [2018] the estimate of economic expansion points to 3.2 percent.

Growth, however, should not mean slowing the pace of the reforms the World Bank says are needed to tap the potential of the African continent.

“Given demographic and investment trends, structural reforms will be needed to increase potential growth over the next decade,” reads the paper, which warns that “downside risks continue to prevail, including the possibility of prices of commodities remaining weak, global financial conditions tightening wildly, and regional political uncertainty and security tensions intensifying”.

Globally, the World Bank revised its growth estimates upwards to 3.1 percent in 2018. Last year it had forecast a 2.8 percent economic expansion for this year.

The upward revision from the previously forecast 2.8 percent growth for 2018 is driven by higher-than-expected economic activity in 2017, which grew 3 percent against the 2.7 percent anticipated six months ago, according to the six-monthly Global Economic Prospects report released in Washington on Tuesday night.

“World growth is stronger than we had anticipated,” World Bank economist Ayhan Kose told AFP. Growth will affect all regions of the world, starting with the “Big Three”: the United States, the Eurozone and Japan.

According to new estimates, by 2018 the United States economic growth will accelerate to 2.5 percent instead of the 2.2 percent estimated in June, Eurozone GDP should grow by 2.1 percent and Japan’s by 1.3 percent.

The two major emerging countries, Brazil and Russia, which in 2017 resumed growth with 1.7 percent and 1 percent after two years of recession, are expected to continue to recover, with estimates of GDP growth in 2018 of 1.7 percent and 2 percent, respectively.

China is expected to continue its “structural slowdown”, but still growing by more than 6 percent, with an estimated increase of 6.4 percent in 2018 and 6.3 percent in 2019, the paper says.