NCPA - National Center for Policy Analysis

IMF Sees World Economy Avoiding Recession This Year

September 27, 2001

The International Monetary Fund predicts the global economy will likely grow at its slowest rate since the early 1990s -- but will escape an outright recession in 2001. But other economists aren't nearly so sanguine.

  • The IMF's latest World Economic Outlook has the world's economies growing at a 2.6 percent rate -- just above the level of 2.5 percent, which the fund classifies as a technical recession.
  • The prediction, however, did not factor in the effects of the September 11 terrorist attacks on the U.S.
  • Kenneth Rogoff, the IMF's chief economist, says that he still expects a relatively strong recovery in the U.S. and abroad next year -- with the fund projecting 3.5 percent global growth.
  • But he warned that the attacks might cause that figure to be lowered in coming weeks.

The lending agency has struggled to put a positive face on economic prospects -- even though most private economists argue that both the U.S. and the world economy will endure recessions this year and have significantly weaker growth in 2002 than most once foresaw.

Source: Joseph Kahn, "IMF Sees World Growth at Its Weakest in a Decade," New York Times, September 27, 2001; based on "World Economic Outlook: The Information Technology Revolution," October 2001, International Monetary Fund, Washington, D.C.

For IMF report

http://www.imf.org/external/pubs/ft/weo/2001/02/index.htm

 

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