United Nations: World economy will slow by 2.6% in 2009

PanARMENIAN.Net - The world economy is mired in the severest financial crisis since the Great Depression. Financial-credit crunch pushed the world economy into recession, says the new UN report on World Economic Situation and Prospects 2009. According to the document, world gross product is expected to slow by 2.6% in 2009.

Prognosis made back in January were more optimistic. They predicted 0.5% slowdown. According to the new report, recession in industrially developed states will negatively impact on developing countries' economic situation.



UN experts say that resource-rich economies in the region were able to take countercyclical policy measures making use of saved fiscal resources and reserves accumulated during the oil price boom. The Russia Federation, for example, introduced stimulus measures totaling 9.1% of GDP. Other economies lacking such a buffer had to turn to the IMF for rescue. Belarus, Armenia, Kyrgyzstan and Ukraine signed stand-by agreements with the Fund. Report also expresses concerns over rising social unrest and political turmoil in some CIS countries. Such tendencies, according to authors. have added to the already substantial degree of economic uncertainty in the region.



Experts believe that recovery is possible in 2010. But that requires supplementary stimulus measures which should take permanent nature. Not ruling out the possibility of prolonged global recession, authors stress that G20 states have taken decisive measures towards increasing the volumes of assistance, but that is not yet enough for achieving long-term and sustainable economic recovery.



The new UN report also focuses on the rise in unemployment rate in 2008. During the coming years, 50 million people are expected to lose their jobs. This figure may double in case of further deterioration of world economic situation, the experts find.