By Heather Yamour
WASHINGTON, Oct 8 (KUNA) -- IMF Managing Director Dominique Strauss-Kahn
cautioned Friday that despite the return of economic growth, the world still
faces the risk of a "lost generation" in the coming years.
"We are gathered here at a pivotal moment facing a very uncertain future,"
Strauss-Kahn said at the plenary meeting for the International Monetary Fund
(IMF) and the World Bank.
"Growth is coming back, but we all know that it is fragile and uneven.
Looking to Asia, South American and Africa are going doing well. But in Europe
recovery is "sluggish" and in the US remains "subdued", He asserted.
Strauss-Kahn said it is not likely that the global economy will experience
a double-dip recession serious downsides remain a threat. These include
mounting public debt, especially in advanced economies; high unemployment
following the global economic crisis that severed 30 million jobs world-wide.
"We need to look for growth and we need to look for jobs," He told finance
ministers from around the world gathered for the annual meetings of the
187-nation IMF and World Bank. "In the coming decade 450 million people are
going to enter the labor market so we really face the risk of a lost
generation," which threatens the health, education, and social stability of
citizens in the long-term.
He called for continued international cooperation and to steer clear of
"currencies wars" touched-off by countries like China, Japan, South Korea and
Brazil who have devalued currencies in order to maintain competitive export
Using currencies as a tool of economic policy can "lead to very bad
situations," Strauss-Kahn cautioned.
China's top central banker on Friday rejected demands for a quick
revaluation of its currency, stating the emerging giant would reform gradually
rather than engage in "shock therapy".
Facing pressure from the U.S., Europe and Japan, Central bank Governor Zhou
Xiaochuan said the yuan would move gradually toward an "equilibrium" level.
The financial sector still faces the lack of oversight that existed when
the global economic began in 2007, putting it at risk. According to
Strauss-Kahn, he said the new financial system is not safe enough to avoid a
crisis as big and as severe as the most recent crisis.
Strauss-Kahn said without greater cooperation the global economy will
continue to struggle and job creation will remain weak. He noted that since
the recession began in 2007, more than 30 million jobs have been lost around
World Bank President Robert Zoellick, also speaking at the plenary session,
said the group of the world's 20 leading economies could help improve global
Since the beginning of the crisis the International Monetary Fund has given
USD 223 Billion to members and disposed of USD 72 billion. The World Bank
committed USD 113 billion to members and disposed of USD 88 billion; including
USD 22 billion to the worlds 79 poorest countries, according to IMF chairman
Olusegun Olutoyin Aganga, also at the plenary meeting.
"Above all, this has been a human crisis", said Aganga. He urged for more
money to "replenish" the World Banks anti-poverty funds in order to achieve
Millennium Development Goals by 2015.
"Addressing poverty remains the main challenge for our own development,"
Aganga said. (end)
KUNA 082113 Oct 10NNNN