View Full Version : IMF warns of decline in global economic growth

09-13-2010, 09:14 AM
wonder if they are refering to iraw when they say weak govt action......


IMF warns of decline in global economic growth

International Monetary Fund warned of significant risks to global economic recovery from the consequences of the financial crisis at a time when many are struggling governments to meet the enormous debt and the continued weakness of the financial sector.
A memorandum written to the Deputy Ministers of Finance of the Group of twenty that while the growth during the first half of this year, stronger than expected, but it is now expected to go down and pace until the end of this year and the first half of next year.
The IMF commended the steps taken by the eurozone countries to tackle a crisis of government debt, emphasizing that they eased fears of financial markets.
But he warned that the renewed crises of government debt may lead to the loss of gains made by the financial sector recently.
Monetary Fund also spoke of what he described as weak government action in dealing with the crisis, budget deficits, pointing out that even with the weak growth should establish governments of developed countries with credible plans to reduce budget deficits next year. The paper recommended to take action to ensure that an economic expansion over the medium term a strong and viable.
Monetary Fund also urged developed countries to increase exports, while countries recommended promising economies especially in Asia, depending more on internal demand for domestic production and reduce exports.
He also referred to the U.S. real estate market conditions as a source of danger especially with the increasing incidence of defaults on loans to borrowers leads to loss of property.
The continued restrictions on bank lending leads to a lack of liquidity available to negatively affect the economy.
Overall, the IMF forecast a rise in total world output this year by 4.6% and next year by 4.3%.
Memorandum did not address the IMF currency policies in the G's, but stressed that the global economic recovery is linked to re-balance between internal and external demands.