Slowdown in developed world is reaching the bottom - OECD

24 June 2009 11:05  [Source: ICIS news]

LONDON (ICIS news)--The Organisation for Economic Cooperation and Development (OECD) on Wednesday said the economic slowdown in the developed world was “reaching the bottom” after the deepest decline in over 60 years.

However, the organisation warned that the recovery was likely to be weak and fragile, with long-lasting economic and social damage.

The OECD revised its predictions for economic growth, showing a general upwards trend, most noticeably in the US and emerging economies.

US economic activity was now expected to fall 2.8% this year, against the 4% decline predicted in March. It was forecast to grow 0.9% in 2010 compared with 0% previously.

Euro area GDP was expected to contract 4.8% this year and show 0% growth in 2010 against previously expected drops of 4.1% and 0.3%.

“Thanks to firm action to stimulate our economies it appears that we have escaped the worst during this crisis,” said Angel Gurría, secretary-general of the OECD.

“But the next few months will be equally testing. There needs to be a clear and credible plan and timeline for phasing out the emergency measures as the recovery takes hold,” he added.

Japan’s GDP was forecast to fall 6.8% in 2009 and rise 0.7% next year, against previously projected falls of 6.6% and 0.5% respectively.

The OECD raised its forecast for China, expecting its economy to grow 7.7% this year and 9.3% in 2010, compared with the 6.3% and 8.5% projections set in March.

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By: Mark Watts
+44 20 8652 3214

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