UNITED NATIONS, June (Xinhuanet) -- The global economic expansion is losing some momentum, with about 3 percent expansion expected for 2005 and 2006, down from the 4 percent of 2004, the United Nations projected Wednesday in its mid-year economic review.

    But "one unusual aspect of the present pattern of global economic growth is that it is widespread among developing countries and economies in transition," said the UN World EconomicSituation and Prospects as of mid-2005.

    Developing country economies overall surged at a 6.6 percent growth rate in 2004, and appear to be set for still-strong growth of over 5 percent in 2005 and 2006, the report said.

    In South Asia, 2004 growth of 7 percent is likely to be replicated in 2005 and 2006. Sub-Saharan African economies, whichgrew at 5.5 percent last year, could expand even faster this year and the next -- although population growth of more than 3 percent per year absorbs much of the positive impact, according to the report. The economies in transition are projected to grow by 6 percent this year, off a torrid 7.6 percent pace in 2004.

    "A high rate of growth since 2004 helps to make up for some difficult years for developing economies at the beginning of the century," UN Under-Secretary-General Jose Antonio Ocampo said at Wednesday's press launch.

    "It also opens a window of opportunity for moving ahead faster on the goals set at global conferences in the 1990s and at the Millennium Summit in 2000. In a faster-growth environment, it is easier for developing nations to invest in health, education and infrastructure. Aid programs from overseas have a better chance ofmaking permanent gains on underlying problems."

    For now, the UN report noted, the international economic environment remains generally favorable for developing countries: international trade continues to grow solidly, the rise in the prices of energy and raw materials in the past two years has improved the terms of trade for many developing countries, but notcompensating for the long-term decline since the 1980s; the costs of external financing are at historical lows and capital inflows are increasing.

    But the world economy faces a number of headwinds: widening external imbalances across major regions; the unwinding of the policy stimuli of the past few years; and the rise of prices of energy and of other primary goods, according to the report.

    It also cited the critical importance of fulfilling world commitments on aid, debt relief and a more open trade system, especially as to benefit the poorest nations. Enditem