World economy not safe yet

The global financial structure is largely unchanged and world economy is not safe yet, the deputy director general of the International Monetary Fund said at the World Economic Forum in the Swiss city of Davos.

According to Zhu Min, the size of banks is the main question facing the financial sector. Their leverage ratio is still too high and financial products are still too complicated.

While the old problems remain unsolved, new challenges are emerging.

Low interest rates will see entrepreneurs take more risks, and while this is a good thing, it must be remembered that the cheap and easy money also played a role in the 2008 crisis, Zhu warned.

In a report released Wednesday, the 188-member IMF predicted that world output would rise 3.5 percent in 2013, a modest uptick from 3.2 percent in 2012. But the figure was slightly lower than the Fund's last projection made in October.

Advanced economies were expected to grow at a rate of 1.4 percent in 2013, a 0.2-percentage-point downward revision from the projection of October 2012.

The IMF forecast a contraction of 0.2 percent this year in the eurozone, which remains a large source of downside risk to the global outlook.

The U.S. economy is predicted to advance 2 percent in 2013 on the assumption that the spending sequester will be replaced by back-loaded measures.

China's growth rate is expected to pick up to 8.2 percent in 2013 from 7.8 percent in 2012.