According to a recent release by International Monetary Fund (IMF), the developing countries will weather the economic slowdown storm sweeping over the world included of the US and many European nations. IMF Managing Director Dominique Strauss-Kahn stated, prospects for the world economy are not bright and indicated improvement in growth, in all likelihood could be anticipated only in 2009. He further added in a conference hosted by Britain’s Prime Minister Gordon Brown, the global prognosis for the world economy is about 3.7 per cent for the next fiscal which is one of the lowest in the last two decades. The IMF’s one of the two yearly installments of the World Economic Outlook is expected to be released on April 9.
Simon Johnson, the IMF’s Economic Counsellor and Director of the Research Department remarked, turbulence in financial markets and tightening of credit markets have accounted for a bleak future to the economic growth of the US and Europe. But added, the rise in manufacturing exports from the developing countries would put them on a safer side of the growth vehicle. Yet cautioned any further price rise in commodities would jeopardize the forecast, since world economies are in sync with one another. Excerpts from the Report, before its formal release said that emerging economies including China, India and Brazil should actively participate in bringing down emissions and thereby to bring about comprehensive solution to the ill effects of the climate change. It also said developing countries will account for 70 percent of greenhouse gases emitted in the next 50 years and must start pricing carbon emissions without any delay for their future growth.
World economy had to confront another setback, since the world trade negotiations at the ministerial level stood cancelled as per WTO communiqué. The reason cited for calling off the talks which was planned to be held before the Doha Round is the absence of satisfactory progress toward a global liberalization deal. Strauss-Kahn was of the opinion, financial stimulants would not take shape until confidence in financial markets returned, and until that happens there would be no end to the current crisis. But his confidence in Doha Round talks seemed to be invalid as of now.