Developing countries’ economies could be assailed if European governments fail to deal with their debt problems, the World Bank’s chief economist, Justin Yifu Lin, said Monday.

Despite a record bailout package, fears remain that Greece’s debt woes will spread to other euro zone nations, damage the global financial system and strangle worldwide economic growth.

“We certainly hope this crisis can be resolved soon because the downturn in the European countries will be bad for the developing countries, and could constrain growth,” Lin told newsmen on the sidelines of a seminar in Stockholm, Sweden.

Chinese premier, Wen Jiabao warned earlier yesterday that global economic growth remained vulnerable to sovereign debt risks and the possibility of a second downturn .

Lin however, allayed fears of a double-dip recession in the global economy.

Last week, the Organisation for Economic Cooperation and Development, sharply raised its forecast for global growth this year and 2011 mainly on the strength in Asian countries’ economies.

It said developed nations’ debt problems were one of the main threats to the global economy.

Greece, this month, received the biggest bailout in financial history, with the International Monetary and the European Union pledging 110 billion euros in 2010-2013 to save the country from defaults.

At a seminar on development challenges in a post-crisis world, Lin said the bailout package was “decisive” and would help stabilise markets, but that there was still a risk of Europe’s problems spilling over to the rest of the world and the developing world was particularly vulnerable.

Lin, who joined the World Bank in 2008 from the China Centre for Economic Research at Peking University, said he hoped government commitments to tackle deficits would help limit any contagion.

“We are in a very integrated world. Anything happening in Europe would affect the rest of the world. And anything happening in the rest of the world would also affect Europe,” he said