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IMF Chief Lowers Forecast for World Economy
The International Monetary Fund has reduced its forecast for the world's economy this year to a growth of 2.7 percent, IMF Executive Directive Horst Koehler said Monday in Berlin.
Koehler told a news conference in Berlin that the IMF had also revised downward to 3.6 percent its GDP growth forecast for 2002. The new projections of 2.7 percent for 2001 and 3.6 percent for 2002 were reduced from the fund's previous forecasts of 3.2 percent and 3.9 percent respectively, he said.
The IMF director refused to comment on reports that the fund's economic growth projection for Germany in 2001 had also been revised to 0.9 percent in from 1.25 percent.
Koehler said it was a matter of grave concern that all of the major industrialized countries were in cyclical retreat. He said he expected an economic recovery by the end of the year that would, however, not solve all problems overnight.
He underlined the necessity for structural transformation in Europe. In this light, the European Central Bank had "plenty of room for interest rate cuts," he said.
Koehler had met with opponents of globalization organized in various non-governemental organizations at the German finance ministry. Koehler said he did not seek concord with the globalization foes but that he wanted to hear all proposals that might heighten the stability of the international financial system while combating poverty and injustice.
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