Tuesday, July 13, 2010

IMF chief sees little risk of double-dip recession

DAEJEON (South Korea): The International Monetary Fund's (IMF) chief reiterated on Tuesday, July 13 that strong growth in Asia and Latin America made it unlikely that the global economy would suffer a double-dip recession.

Last week, the IMF upgraded its 2010 global economic growth forecast to 4.6% from 4.2% due to robust expansion in Asia and renewed US private demand, but kept its 2011 outlook unchanged at 4.3%.

"We expect 2011 to be a little lower than the level of 2010. But all this is too far from any kind of double-dip," managing director Dominique Strauss-Kahn told a news conference in the central South Korean city of Daejeon. "Certainly, our forecast is not the forecast of a double-dip," Strauss-Kahn said.

South Korea's Finance Minister Yoon Jeung-hyun, who also attended the conference, also voiced confidence in the global economy, saying a recent slowdown in the United States and China was temporary.

The world economy has been recovering this year from its worst downturn in decades, but signs of cooling growth in the world's largest and third-biggest economies sparked worries that the global upswing could prove short-lived.

"The recent weak economic data in the US and China is transitory with ends of governments' stimulus packages. They will be normalised soon," Yoon said.

Yoon also sounded optimistic about Europe's ability to solve its fiscal problems, though he said it would take time and for now Asia was leading the global recovery.

"During the recent economic crisis, the Asian economy has spearheaded the global economic recovery with appropriate stimulus packages and sound macroeconomic conditions. This trend is expected to continue for a while," he said. ' Reuters

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