1. The External Environment for Developing Countries May 2010 The World Bank Development Economics Prospects Group

2. CDS spreads – EU -5 vs. selected EMs Brazil, Russia, China, Turkey, Indonesia ( BRCTI ) Source: JPMorgan and World Bank data.

3. Claims of EU Periphery banks on EMs as percent of lender ’ s GDP Source : IFC calculations based on BIS data.

4. OECD developments

5. Greek contagion fears were calmed by a momentous policy package Source : Bloomberg and DECPG staff calculations.

6. Source : Thomson - Datastream Euro falls sharply vis - à - vis greenback USD per euro [ left ]; CACI and DAX indexes, February -15, 2010=100 USD per euro [ L ] DAX [ R ] CACI [ R ]

7. Euro Zone growth dissapoints in first quarter quarterly growth of real GDP, percentage change, q / q saar Source : Eurostat

8. German export orders revive in March factory orders received from abroad and industrial production, ch % saar Source : Eurostat

9. U. S. GDP growth eases to 3.2% in Q 1-2010 on stocks, investment and exports quarterly growth of real GDP ( saar ), and contributions to growth in percentage points Source : World Bank, DEC Prospects Group.

10. U. S. employment gains now firmly in positive territory… supporting demand retail sales x autos ch % saar [ left ]; change in employment ‘000 (3 mma ) [ right ] Source : U. S. Departments of Commerce and Labor.

11. Forward - looking indicators also favorable Source : Thomsom / Datastream. new orders ( ch % saar ), DJIA ( ch %, y / y ) [ L ]; LEI [ R ]

12. Japan orders, exports, and IP show moderate sign of slack – waiting return of demand private machinery orders, export volumes and production, ch % (3 m /3 m, saar ) Source : Japan Cabinet Office, METI.

13. Japanese consumer now adding meaningfully to growth Source : Japan Cabinet Office, METI. retail sales volume, ch % year - on - year [ L ]; and Tokyo Consumer Confidence Index [ R ]

14. Country Focus: Brazil

15. Domestic demand continues to drive industrial production inBrazil Source : Thompson / Datastream.

16. Inflationary pressures are building Source : Thompson / Datastream. Inflation, ch % yr - on - yr [ L ], SELIC rate, % [ R ]

17. Limited spillovers from European Crisis to Brzilian financial markets Source : Thompson / Datastream. EMBI Spreads, basis points [ L ], BOVESPA [ R ]

18. Industrial production

19. The shift to the right in the distribution of monthly growth in IP points to recovery Source : Development Prospects Group.

20. Industrial production exceeds pre - crisis peaks in selected countries Source : Development Prospects Group. pre – crisis peak = 100

21. Strong IP carryover will ensure robust performance in the second quarter percent, 3 m /3 m saar Source : Development Prospects Group.

22. International trade

23. Share of Southern Euro Zone in total exports percent share of total exports in 2008 Source : World Bank, UN - COMTRADE.

24. Share of world trade for developing countries share of world imports in percent Source : World Bank, UN - COMTRADE.

25. G 20 use of selected temporary trade barriers By import source, 1997-2009, unique product - exporter combinations Source : Bown (2010), Global Anti - dumping Database.

26. Oil prices

27. OECD oil stocks ( days of forward consumption ) Source : IEA, Bloomberg and DECPG.

28. Crude oil prices drop and differentials skew $/ bbl Brent Dubai Source : Datastream and DECPG. WTI

29. WTI Futures Prices – NYMEX monthly contract prices to Dec 2015* for select dates in 2010 May 18 $/ bb l Jan 29 Mar 31 Source : NYMEX. Apr 30 * Futures prices extend semi - annually to Dec 2018

30. Non-oil commodity prices

31. Ag - gains led by raw materials and beverages (2000=100) Source : DECPG.

32. Metals prices fall on Eurozone woes $/ ton ‘000 tons Nickel price LME stocks Source : Datastream and DECPG.

33. Gold prices ( per troy ounce ) currency / t oz Gold in dollars Gold in euros Source : Datastream and DECPG.

34. International Finance

35. Capital flows steady in April Source : DECPG. $ billion 2008 2009 2010 Q1Total Q1Total Q1JanFebMarApr Total 103390 48353 9433174745 Bonds 1265 18115 48215 26 Banks 71257 22129 1945138 Equity 2068 8109 27771211 Lat. America 1990 21137 29941715 Bonds 520 1062 1982109 E. Europe 36157 672 241221014 Bonds 235 433 1771811 Asia 3898 18122 331271511 Bonds 37 516 9720.33 Others 1145 322 80.2354

36. Relative to Lehman collapse, the magnitude of recent corrections has been modest Source : JP Morgan and Bloomberg.

37. Signs of monetary tightening in some emerging market countries Sources : JP Morgan and DECPG staff calculations

38. Currencies and inflation

39. Source : Thomson / Datastream. yen / USD USD / Euro ( inverse ) Euro takes large loss vis - à - vis dollar on “ market failure ” of EU / IMF Greek package USD per Euro ( inverse ) [ Left ] and Yen per USD [ right ]

40. Euro - cross exchange rates show obverse movements for C. European units Source : Thomson / Datastream. LCU per euro, index January 2008=100

41. Volatility in USD LIBOR not echoed in interbank rates for other key currencies Source : Thomson / Datastream. LIBOR -6 month rates.. US dollar, euro, sterling and yen

42. Focus Euro Zone crisis : implications for developing countries

43. Greek contagion fears were calmed by a momentous policy package Source : Bloomberg and DECPG staff calculations.

44. Massive fiscal adjustments required are a substantial source of concern Source : IMF.

45. Banking sector vulnerability is a crtical element in potential contagion effects Source: JP Morgan and DECPG staff calculations.

46. CDS spreads – EU -5 vs. selected EMs Brazil, Russia, China, Turkey, Indonesia ( BRCTI ) Source: JPMorgan and World Bank data.

47. CDS Spreads for similarly rated countries as of May 17, 2010 – basis points Source : IFC based on Bloomberg and S & P Data

48. Claims of EU Periphery banks on EMs as percent of lender ’ s GDP Source : IFC calculations based on BIS data.

49. The External Environment for Developing Countries May 2010 The World Bank Development Economics Prospects Group

50. Potential Impact of Greek Crisis on GDP Growth Forecasts % Source: World Bank. Preliminary simulations

51. Growth differentials among OECD and between OECD and developing widening Real GDP growth, percent, Q 4-2009 and Q 1-2010, year - on - year Source : Datastream, Haver and World Bank data. * q 1 is estimate. 48.6% of World GDP 12.4% of World GDP

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