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World Economy to Pick up Pace in Second Half of 2002: APEC Official
The world economy will begin to reverse its current slowdown in growth in the second half of 2002, said Kyung Tae Lee, chair of the APEC Economic Committee, on Thursday.
The September 11 terrorist attack on the United States has at least postponed the recovery of the U.S. economy by two quarters and the most affected economic sectors are insurance and air industries, Lee said at a press conference.
But the negative implications of the terrorist attack will be " a short-term thing" although the attack generated added uncertainty about the timing and strength of the global economic recovery, Lee said.
Despite many downside elements in the world economy, there are also some positive factors which will put the world economy back on the track of growth, he said.
"Underlying inflationary pressures have been relatively subdued in the APEC region, giving room for more macroeconomic policies to counter the slowdown," the APEC official said. "Monetary easing and more expansionary fiscal policies in many APEC member economies should help revitalize demand in due course, " he said.
The gradual abatement of oil prices shock and the general easing in commodity prices would also lend help to a quicker global recovery, according to an annual report submitted to the 13th APEC Ministerial Meeting, which is scheduled to end here Thursday.
Prospects for 2001 remain weak, but the slowdown is expected by many analysts to end in the second half of next year, Lee said.
He recommended the APEC member economies to improve financial efficiency and work to strengthen macroeconomic foundations.
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