Global recession will be deep says IMF
The International Monetary Fund has released its bi-annual World Economic Outlook report with the dire summary that the world will undergo a deep recession that will affect every country. The report also predicted that “the current recession is likely to be unusually long and severe and the recovery sluggish”.
Analysis included:
- Recessions brought on by a financial crisis are longer and deeper than those with from macro-economic problems.
- Global recessions last longer and have weaker recoveries than those of a single country.
- Expansionary fiscal policy, such as increased government spending and stimulus action, “seems particularly effective in shortening recessions associated with financial crises”.
- Developing countries may have problems attaining finance, even following recovery, as global investors will remain risk averse for some time after a recession.
IMF managing director Dominique Strauss-Kahn said the outlook was grim for 2009: “We expect global growth to enter deeply negative territory. This is a truly global crisis, and nobody is escaping.”
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Well it is small business that will be able to take best advantage of this situation. thereby pulling the country and the world out of the slump.
governments should focus their fiscal stimulus on small and medium business areas
IMF is saying that more and more people will lose jobs in this 2009.But saving money and doing less expenditure can make a person relax in this situation.