Thread: IMF: economic slump to engulf the globe

From Times Online
March 19, 2009

IMF: economic slump to engulf the globe

Gary Duncan, Economics Editor

More aggressive, concerted efforts are needed by key economies to quell financial market stresses if the world is to avoid an even sharper and longer recession, the International Monetary Fund urged today.

The warning from the IMF that still more far-reaching efforts were needed from leading developed and emerging market economies, and that these needed to be internationally coordinated, came as it forecast the worst global slump since the Second World War.

The world economy is now set to shrink by between 0.5 per cent and 1 per cent over this year, in its first outright contraction in the post-war era, the Fund said in grim new projections. Developed economies will contract by between 3 and 3.5 per cent, with an anaemic recovery leading to only stagnation, with zero growth, in the rich world in 2010, it added.

Confirming figures leaked earlier this week, the IMF also forecast that the US economy will now contract by a brutal 2.6 per cent in 2009, and the eurozone by a still worse 3.2 per cent. Japan will likely suffer a 5.8 per cent contraction in 2009 and will continue to shrink in 2010 by 0.2 per cent, it found.

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The bleak projections came in a report prepared for last week’s meeting of finance ministers and central bank governors from the Group of 20 leading economies.

“Turning around global growth will depend critically on more concerted policy actions to stabilise financial conditions as well as sustained, strong policy support to bolster demand,â€

Never put all your eggs in one basket. Never totally count on anyone else to do what you think they should.....only YOU are left holding the bag.