THE International Monetary Fund (IMF) said it has downgraded its growth projection for the world economy for this year as the financial markets remain under stress despite the policy measures introduced to provide additional capital and reduce credit risks.
In its World Economic Outlook (WEO) update, the so-called world lender of last resort said global economic growth would decline sharply to 0.5 percent this year compared with its earlier projection of 2.2 percent made in November last year.
This incorporates a large downward revision of 1+ percentage points for both advanced and emerging economies.
The advanced economies are expected to suffer recessions, as the IMF projects them to contract by 2 percent this year. It said emerging and developing economies are expected to grow by 3.3 percent.
“Financial markets are expected to remain strained during 2009,” the IMF said. It said the market conditions of the advanced economies would continue to be difficult despite restructuring in their financial sectors. Meanwhile, the financial conditions of emerging economies would likely remain acute especially for corporations, it added.
“The continuation of [the] financial crisis, as policies failed to dispel uncertainty, has caused asset values to fall sharply across advanced and emerging economies, decreasing household wealth and thereby putting downward pressure on consumer demand,” the report said.
At the same time, the disruptions in credit are constraining household spending and curtailing production and trade.
Emerging and developing economies are expected to slow sharply under the drag of falling export demand and financing, lower commodity prices, and much tighter external financing constraints, the lender said.
It, however, expects global economic recovery next year, reaching 3 percent, given the continued effort to ease credit strains as well as monetary and fiscal measures.
The IMF said monetary policy remains an important policy, adding a substantial increase in policy rates would support economic activities. The implementation of fiscal stimulus also would provide a key support to growth, it said.
Central banks in emerging economies are also moving to ease their policy stance and improve liquidity, it added.
— Maricel E. Burgonio
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“Support women every day of the year!”
Invoke Article 33 of the ILO constitution
against the military junta in Myanmar to carry out the 2021 ILO Commission of Inquiry recommendations against serious violations of Forced Labour and Freedom of Association protocols.
Accept National Unity Government
(NUG) of Myanmar.
Reject Military!
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Monthly Observances:
Women’s Role in History Month
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Week 1: Environmental Week
Women’s Week
Week 3: Philippine Industry and Made-in-the-Philippines
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Last Week: Protection and Gender-Fair Treatment
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Daily Observances:
March 8: Women’s Rights and
International Peace Day;
National Women’s Day
Mar 4— Employee Appreciation Day
Mar 15 — World Consumer Rights Day
Mar 18 — Global Recycling Day
Mar 21 — International Day for the Elimination of Racial Discrimination
Mar 23 — International Day for the Right to the Truth concerning Gross Human Rights Violations and for the Dignity of Victims
Mar 25 — International Day of Remembrance of the Victims of Slavery and the Transatlantic Slave Trade
Mar 27 — Earth Hour