Welcome Guest   |  Login   |   Signup
JG Logo
Fri, February 10, 2012
Archive Search

‘Risks Remain’ as Trade Drops Most in 64 Years
February 24, 2010

Share This Page
0
0
0
0
Share with google+ :


Post a comment
Please login to post comment

Comments

Be the first to write your opinion!

Seoul. Global economic authorities need to maintain stimulus policies as the world economy still faces downside risk, a World Bank official said on Wednesday.

Also, international trade suffered its biggest fall since the end of World War II thanks to the Great Recession, the WTO said.

Justin Lin, chief economist and senior vice president of the World Bank, said on Wednesday that most Asian countries were unlikely to experience sovereign debt problems.

But it is “too early to exit” stimulus measures, he added. “Uncertainties remain. The downside risks include excess capacity. Under-utilized capacity is still very high, meaning unemployment will be maintained at a high level and consumption will be slow and conservative,” Lin said at a conference in Seoul.

The remarks came a day after data showing US consumer sentiment fell to a 10-month low, raising doubt about the pace of a global economic recovery.

Sustained fiscal stimuli may increase government debt, but Asian countries are not expected to face sovereign credit problems, he said. “They, in general, can endure external shocks, given sufficient forex reserves. Government deficits are relatively small and manageable,” Lin said.

Meanwhile, in Brussels WTO chief Pascal Lamy said on Wednesday that world trade fell by 12 percent last year as the economic crisis caused the biggest drop since 1945, giving new urgency to the need to conclude trade talks. The unprecedented drop in global commerce makes it “imperative” international trade negotiations, which are at a standstill, Lamy said.

The Doha trade talks began in 2001 with a focus on dismantling obstacles to trade for poor nations, by aiming for a deal that would cut agriculture subsidies and tariffs on industrial goods.

Deadlines to conclude the talks have been repeatedly missed. Discussions have been dogged by disagreements, including on how much the United States and the European Union should reduce farm aid and the extent to which developing countries such as India and China should lower tariffs.

 

Reuters, AFP