IMF revises upward world economic growth to 4.8%

The International Monetary Fund (IMF) on Wednesday upwardly revised its projection of world output to 4.8 percent this year, but warned downside risks remain elevated.

"Thus far, economic recovery is proceeding broadly as expected, but downside risks remain elevated," said the IMF in its latest World Economic Outlook report.

According to the report, the world economy, which declined by 0.6 percent in 2009, will recover gradually in 2010 and 2011, growing by 4.8 percent and 4.2 percent respectively.

In its July projections, world growth in 2010 and 2011 was expected to be 4.6 percent and 4.3 percent.

"Most advanced economies and a few emerging economies still face large adjustments," said the new report. "Their recoveries are proceeding at a sluggish pace, and high unemployment poses major social challenges."

The advanced economies are expected to expand by 2.7 percent this year, and by 2.2 percent in 2011, following a decline in output of 3.2 percent in 2009.

By contrast, many emerging and developing economies are again seeing strong growth, because they did not experience major financial excesses just prior to the Great Recession.

Growth in emerging and developing economies is projected to be over 7.1 percent and 6.4 in 2011, following a modest 2.5 percent gain in 2009.

Although the world economy is expected to grow at slower pace in the coming year, a double dip recession "is unlikely," said IMF Chief Economist Oliver Blanchard.

The economic growth in the U.S., which has been at the center of the global financial storm, is projected to accelerate to 2.6 percent this year and 2.3 percent in 2011, following a decline of 2.6 percent in 2009.

Among the hardest hit during the global crisis, Europe is coming out of recession at a slower pace than other regions.

The euro zone economy will grow by 1.7 percent this year and 1.5 in 2011, the IMF said, criticizing the bloc for sizable fiscal and current account imbalances.

In Japan, the IMF expects the output to rise by 2.8 this year and 1.5 in 2010, much better the decline of 5.2 percent in 2009.

Source:Xinhua