19 November 2009 18:19 [Source: ICIS news]
HOUSTON (ICIS news)--Government stimulus measures from countries such as China will drive gross domestic product (GDP) growth in most global economies in 2010, but the recovery is still too weak to halt rising unemployment, the Organisation for Economic Co-operation and Development (OECD) said on Thursday.
For the 30 OECD member countries, GDP is projected to expand by 1.9% in 2010 and 2.5% in 2011 after falling by 3.5% in 2009, the report said.
Because the country started its stimulus programme with a sizable surplus and negative net government debt, the government can afford to keep spending at higher levels, the organisation added.
However, headwinds from financial sector deleveraging and rising unemployment figures were likely to make the European region’s recovery slower than in the
“Medium–term growth prospects [for
While the unemployment rate was likely to peak in the first half of 2010 in the
Looking beyond 2010, the OECD said unprecedented policy efforts – such as the stimulus measures – have succeeded in limiting the severity of the economic downturn and fostering a recovery to a degree that was largely unexpected even six months ago.
However, as a result of those measures, the gross debt of most countries could be larger than their GDP by 2011. Action to bring public finances under control will need to be substantial in most countries and drastic in some, according to the group.
“Removing stimulus measures is imperative, but such action has to be carried out gradually to avoid undermining the recovery,” said OECD secretary-general Angel Gurria.
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