Delegates of the G20 Finance Ministers and Central Bank Governors' Meeting pose for an official family photograph during the World Bank-IMF Spring Meetings. (Photo: EPA/MICHAEL REYNOLDS /LANDOV)

The World Bank’s June 2011 edition of the publication Global Economic Prospects urges the leaders of developing countries to think locally, not globally. The report says they can do that by focusing on keys to sustainable economic development.

They are: the creation of structural reforms for balanced growth, finding ways to live with inflation and learning how to cope with high-priced commodities.

The World Bank projects that economic growth in developing countries will decrease from the 7.3 percent reported for 2010 to about 6.3 percent each year between 2011 and 2013 as countries reach full capacity. This will occur as the higher-income countries and Europe fight continued high unemployment and fiscal issues.

The most dangerous situations for developing countries are the problems of escalating oil and food prices. “Further increases in already high oil and food prices could significantly curb economic growth and hurt the poor,” said Justin Yifu Lin, the World Bank’s chief economist and senior vice president for development.

The plus side of commodity price increases has been that a number of developing countries produce the agricultural and mineral exports that the higher-income countries are willing to more for.

Hans Timmer is the director of Development Prospects at the World Bank. He says that developing countries have been resilient for the past few years, but that many of them, particularly in Latin America and Asia, are already operating at their best capacity and risk creating an inflationary situation. “Monetary policy has responded, but fiscal and exchange rate policy may need to play a bigger role to keep inflation in check,” he said.