World Economic Outlook

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By International Monetary Fund (IMF)

Published on July 16th 2012, by Europe based institution international monetary fund (IMF). The world economic outlook is one of the most important and authentic report on the analysis & forecast of the global economy which highlights the following points about the global economy:

1. The global economy is showing signs of recovery but the pace is slower then expected by the IMF.
2. The growth is almost negligible in the Euro zone. While countries like Germany & France are showing positive growth, but at the same time Greece, postural & spain showing negative growth.
3. Though in case of the United States, the growth is positive but too low to make a serious dent on unemployment.
4. Developing economies like India & China are growing but still at a slower pace then expected. The main reason being the lower export and falling investment rate.

The Steps Ahead: For emerging economies it is advisable to adopt both economic and macro prudential policies to respond to a tough situation. Capital flows are expected to be highly volatile, and export to the developed economies subdued. The crucial steps that are required are fiscal consolidation at the right pace, expansionary monetary policies & solidarity within the Eurozone.

About IMF

Having its headquarter in Washington DC, the international monetary fund is an international organization of 187 countries. It came into existence on December 27th, 1945. The major objectives of IMF are as follows:

• Promotion of international monetary cooperation.
• Facilitation of international trade for economic growth
• To help member countries during balance of payment crisis.

India & the IMF

India became a member of the IMF in 1945 as one of its original member countries and still having a fruitful relation. Through during 1991-93 India had to seek IMF’s help but now the country has become a creditor to the IMF & stopped seeking financial aid from it.

Importance from the examination point of view:

1. Short Notes: World Economic Outlook,
2. Short Notes IMF – Role & objective – Mains – 2010
3. Does India need IMF now? Comment
4. Highlight the various points published recently in the World Economic Outlook by the IMF. Discuss in brief the concerns about the eurozone as well as developing Asian economics.

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