In its twice-yearly economic outlook, the Paris-based Organization for Economic Co-operation and Development forecast that global growth would ease to 3.4 percent this yearfrom 3.6 percent in 2011, before accelerating to 4.2 percent in2013, in line with its last estimates from late November. “The global economic outlook is still cloudy,” OECD Secretary General Angel Gurria told reporters. “At first sight the prospects for the global economy aresomewhat brighter than six months ago. At closer inspection, theglobal economic recovery is weak, considerable downside risksremain and sizable imbalances remain to be addressed.” Growth across the organization’s 34 members, generally thewealthiest in the world, would ease this year to 1.6 percent from1.8 percent in 2011 and then reach 2.2 percent in 2013, the OECDsaid, also roughly in line with previous estimates. Gurria said that public finances were “fragile”, and insome cases “in dire straits”, in OECD countries. BMW Sat Nav DVD
A perception that the burden of the economic crisis had not beenfairly shared was fuelling a confidence crisis and European leadersshould consider all possible measures to mend the bloc’s debtproblems. “A bad outcome scenario in the euro area with implications forthe rest of the world cannot be ruled out,” he said. The OECD forecast that the 17-member euro zone economy would shrink0.1 percent this year before posting growth of 0.9 percent in 2013,though regional powerhouse Germany would chalk up growth of 1.2 percent in 2012 and 2.0 percent in2013. “We see a slow rebound of growth in the United States drivenmostly by private demand, some pick-up in Japan and moderate tostrong growth in emerging economies,” OECD chief economistPier Carlo Padoan told Reuters in an interview. China Honda Sat Nav DVD
“We also see flat growth in the euro area which hidesimportant differences, with northern countries growing and southerncountries in recession,” he added. Although OECD economies were on the mend, the euro crisis couldstill spiral out of control with Greece struggling to remain solvent and Spanish banks needing to berecapitalized, Padoan said. The European Central Bank ‘s injection of one trillion euros ($1.3 trillion) of liquidityinto the euro zone’s banking system and an increase in Europeanbailout funds and IMF reserves had helped keep the euro zone’s debt crisis fromspiraling out of control. “If the situation gets worse, there are ways to enhance thefirewall capacity which could include a stronger intervention orrole of the ECB,” Padoan said. Car Stereo Sat Nav Manufacturer
In particular, the ECB should not rule out buying government bondsagain to keep borrowing costs down, lending to the ESM Europeanbailout fund and cutting its benchmark interest rate, whichcurrently stands at 1.00 percent. The ECB could also consideranother injection of liquidity into the banking system.