In contrast, in the emerging economies, GDP growth is strong. These countries account for almost half of the world’s GDP and for almost 70 per cent of the world’s growth this year. China is expected to continue to grow by almost 10 per cent per year, and India by about 8 per cent over the years ahead. In the two other BRIC countries, Brazil and Russia, growth in the range of 4–5 per cent is expected (see Table 1). Differences around the world are also extensive in terms of inflation. In the United States and the euro area, inflation has risen in recent years, primarily as a result of rising energy and commodity prices, but underlying inflation excluding these prices is still low. In the BRIC countries, on the other hand, inflation is high, and the monetary policies of these countries are now being tightened to avoid overheating (see Table 2). However, there are also risks in international developments. The greatest risk for us in Sweden is probably whether the fiscal problems in certain euro area countries will lead to renewed turbulence on the financial markets. Greece, Ireland and Portugal have already received assistance from the EU and the International Monetary Fund (IMF), but it remains unclear whether Greece, in particular, will be able to repay its debts. Furthermore, the possibility that Spain may also encounter difficulties in managing its problems cannot be ruled out.
The economic conditions for wage formation in the years ahead I will now briefly present the Riksbank’s assessment of economic development in recent years. I will refer to the most recently published forecast from April. Of course, quite a lot has happened since then, but, at the same time, two months later you don’t normally know a great deal more about developments two to three years ahead. In any event, we will be publishing an updated assessment in the Monetary Policy Report in July. The international recovery is proceeding at a good rate For the world as a whole, we expect to see a GDP growth of over 4 per cent per year for the next three years. This is a high growth rate from an historical perspective (see Figure 4). But  4  BIS central bankers’ speeches  developments across the world are divided, with weaker growth taking place in the developed economies and stronger growth in emerging economies. The recovery of the United States and Europe is continuing at a fairly moderate pace. In the United States, GDP is now back to the level it was at before the crisis (see Figure 5). But the labour market has yet to recover. In the euro area, it seems likely to take a couple more years until GDP has returned to the same level as before the crisis. Growth in Europe is being restrained by the fiscal problems in several countries and the tightening of fiscal policies (see Figure 5).