International Monetary Fund world economic forecast

1. Wide shot of news conference
2. Cutaway reporter
3. SOUNDBITE: (English) Olivier Blanchard, IMF Economic Counsellor and Director of Research:
“Global prospects have definitely improved since we last met in October. The world economy is recovering. We project world growth to be about 4 per cent in 2010 and 4.3 per cent in 2011. The recovery remains however largely policy driven and it is increasingly a multi-speed recovery. We have, in a sense, moved from a remarkably synchronised global downturn to a more differentiated global recovery.”
4. Push in view detail of IMF World Economic Outlook report
5. SOUNDBITE: (English) Olivier Blanchard, IMF Economic Counsellor and Director of Research:
“In the US, growth in 2010 will still be largely driven by inventory investment on the one hand and fiscal policy on the other, and the challenge remains of durably replacing these sources of growth by sustained growth in private demand, be it consumption, investments or net exports. Without completing the relay to private demand, a strong and lasting recovery cannot be achieved. Very similar issues arise for both the Euro and Japan.”
6. Wide of news conference
7. SOUNDBITE (English) Jose Vinals, IMF Financial Counsellor:
“Even with this overall improvement however, the repair of the financial system is by no means complete and financial stability remains fragile.”
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9. Images of IMF report
10. SOUNDBITE: (English) Jorg Decressin, IMF Chief World Economic Studies Division:
“In our view we don”t see a serious risk of a market bubble in China. Asset prices in some specific sectors, in some specific regions of China may be frothy but there certainly is no widespread asset price bubble.”
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STORYLINE:
In its latest global economic outlook, the International Monetary Fund reports the world economy is recovering at a healthy pace but still needs government stimulus efforts to keep it going.
The IMF raised its forecast for world economic growth in 2010 to nearly 4 percent, up from an estimate of 3.1 percent last October.
“Global prospects have definitely improved since we last met in last October, ” said the IMF”s chief economist Olivier Blanchard.
The IMF expects the US economy to grow by 2.7 percent this year, significantly higher than its previous forecast of 1.5 percent.
But with unemployment high in many countries and credit tight, the recovery in the United States and other advanced economies “is still expected to be weak by historical standards,” the IMF said in a quarterly update of its World Economic Outlook.
Blanchard told reporters that in the US, “growth in 2010 will still be largely driven by inventory investment on the one hand and fiscal policy on the other” and that challenges remain in replacing these sources of financing.
He added that similar issues will be faced in the the Euro zone and Japan.
The IMF also projected that the 15 nations that use the euro would grow by 1 percent in 2010, up from its 0.3 percent estimate in October.
It kept its estimate for Japan the same, at 1.7 percent growth.
It forecast China”s growth this year at 10 percent, and said key emerging economies in Asia are leading the global recovery.
A “key risk” to the recovery “is that a premature and incoherent exit” from the low interest rates set by many central banks and other stimulus programs “may undermine global growth,” the IMF said.
The IMF”s Financial Counsellor, Jose Vinals, told reporters that “the repair of the financial system is by no means complete and financial stability remains fragile.”
The IMF provides loans and other assistance to troubled countries and has 186 member nations.
It also performs economic analysis and monitoring.

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