IMF managing director Horst Koehler said today that while the world economic outlook had weakened as financial markets plunged into turmoil, there was no need to dwell in doom.
'Since the spring meeting, prospects for the global economy have clearly weakened amid considerable financial market volatility,' he said ahead of weekend meetings of the world's economic policymakers. 'But it would not be productive in our view now to dwell in undue pessimism or even doom or gloom,' he said.
Global economic output is projected to grow 3.7% in 2003, down from the IMF forecast in April of 4% growth, the IMF said in a semi-annual report released in the run-up to the meetings. The IMF also tipped growth of 2.8% this year, unchanged from the previous forecast despite a surprise spurt in growth at the start of this year.
'The global economy has shown remarkable resilience in the face of multiple shocks of the past two years,' Koehler said. 'There are still good reasons to expect the recovery to continue in the two years ahead,' he added.
He said that faster growth in Japan and Europe would help to narrow yawning gaps in global current account balances - the widest measures of countries' international trade and financial flows.
