The crisis in the euro area is a danger to the world
Tuesday, May 22nd, 2012
The global economy benefits from the acceleration of trade and, more generally, a renewed confidence. But the worsening debt crisis in recent months is still the main risk to the threat, says OECD.
The Organisation for Economic Cooperation and Development, which today released its semiannual forecast, expects global growth to 3.4% this year and 4.2% in 2013, against 3.4% and 4.3% respectively in the projections of last November. Market participants are concerned about a possible exit of Greece in the euro area, such as to destabilize the EU and its banking system. The strength of Spanish banks, which will have to recapitalize in the coming weeks, is also a central concern.
"After a respite at the end of last year the crisis in the euro area is made more serious recently and remains the largest source of risk for the world economy (…). The drag on growth due to fiscal consolidation could be significant, particularly in some countries, "said the chief economist of the OECD, Pier Carlo Padoan, in the" editorial "of the report.
The recovery is not enough
For the OECD, the structural imbalances between the countries of the region, she said the cause of the crisis, have only just started to reverse. And the recovery in the countries most solids is not sufficient to offset the stagnation or even recession in some cases, countries in difficulty. "The competitiveness, low in deficit countries, must be resolved while a structural adjustment and higher wages in the surplus countries would contribute to rebalancing pro-growth," it added low fee payday loans.
The OECD believes that in addition to reforms undertaken by the States the European Central Bank has room for maneuver to pursue a policy of monetary easing, especially through its "program for securities markets" (SMP program redemption of government bonds).
If Europe crystallizes concerns, the OECD is more optimistic for the United States, it considers should enjoy growth of 2.4% this year and 2.6% in 2013.
France should resume in the second half
After an expected stagnation in the first half, the French economy is expected to recover in the second, to show a 0.6% growth in 2012, a rate too low, however, to generate new jobs according to calculations by economists. For 2013, the OECD projects a growth rate of 1.2% in France, below the government's projections, which built its program on the basis of economic growth set at 1.7%. "Residential investment would decelerate as house prices began to decline. Unemployment could peak at 10.5% in early 2013 and decline only slowly from that date, "writes the OECD. "But in spite of low growth, the goal of reducing the budget deficit to 4.5% (GDP) in 2012 should be achieved through a better result in 2011 had been anticipated (5.2%) .
The new government is committed to Europe's promise of France to reach a budget deficit of 3% in 2013.
The OECD notes that "most of the consolidation effort in France will have to come from lower public spending."