However the IMF policy board is keeping a positive outlook and says it has agreed to “act decisively to restore confidence and financial stability, and rekindle global growth.” IMF chief Christina Lagarde is trying hard to quash any concerns about the world’s top financial officials earnestness in dealing with the crisis. “There was no denial, no finger-pointing,” said Lagarde of the recent meeting of the IMF.

US Treasury Secretary Timothy Geithner has given stern warning that Europe’s Leaders aren’t keeping up with the fast-moving markets, insisting that they move away from any reliance on the European central bank to deal with the crisis. The IMF, alongside Germany and France, has agreed to commit to the July 21 package of new money for Greece and broaden the scope of the emergency European Financial Stability Facility. “We are hand in hand with Germany to implement the July 21 agreement, not to move away from this strategy,” said French Finance Minister, Francois Baroin.

Many hurdles are still to come, with Greece still hoping to remain in the eurozone. German Finance Minister, Wolfgang Schaeuble said if Greece takes the necessary measures, “we’ll do everything to make that happen”.

In its latest outlook for the Asia-Pacific region, the IMF said integration with Asia and increasing dependence on commodity exports make growth in Australia and New Zealand more vulnerable to swings in commodity prices and demand.

Present demand driven by China and India could add 20 percent to the Australian economy over the next decade. The IMF wants revenue from the current resources boom to be saved, “in order to ensure a more equal distribution of its benefits across generations and reduce long-term fiscal vulnerabilities from an ageing population and rising health care costs.”

IMF director Anoop Singh says China and the rest of emerging Asia are confronting the threat of surging inflation that could destabilise the region. “If we allow a bubble to develop this would set the stage for a correction in the future that could be quite painful,” he said.

That bubble is already growing in China, Korea and Germany according to Asianomics economist Dr Jim Walker. “It is a dangerous position to get any country into, to be so dependent on one customer,” he said.

In Beijing recently, Prime Minister Julia Gillard reaffirmed economic ties with China, which buys one quarter of all Australian exports. ”Of course our economic relationship is a vital one for Australia’s national interest and it’s growing in leaps and bounds.”

Treasurer Wayne Swan has rejected the notion of a wealth fund, indicating reforms to superannuation will boost national savings to $500 billion by 2035.

“We may be coming out of one crisis—the financial and economic crisis—but we are facing new risks and wrenching challenges,” said World Bank President Robert Zoellick.

The impacts of surging food prices on political stability in developing countries cannot be underestimated, Zoellick stressed. “We are one shock away from a full-blown crisis. The financial crisis taught us that prevention is better than cure. We cannot afford to forget that lesson.”

The World Bank also warned worsening conditions in the Middle East and North Africa could easily “derail” global growth. “If oil prices were to rise sharply and durably—either because of increased uncertainty or due to a significant disruption to oil supply—global growth could slow by between 0.3 and 1.2 percentage points in 2011 and 2012, respectively.”

IMF managing director Dominique Strauss-Kahn concurred, saying that good figures at the growth level did not mean the growth was sustainable, “just because of the political problems behind it.” He added the IMF stood ready to offer technical and financial assistance to struggling economies.

Strauss-Kahn said advanced economies still posted alarming levels of joblessness and “a lot of repair is still needed” in the finance sectors of developed countries. He warned emerging economies were at risk of overheating as growth sped up, driving inflation and an exponential rise in the basic costs of living. “Growth is not enough, because the old pattern, following which if you had growth, the rest would follow, doesn’t work any more,” he said.

Tharman Shanmugaratnam, chairman of the IMF’s monetary and financial committee, said there was a sense around the table that the world was still in a fairly fragile situation following the 2008 Global Financial Crisis. “We have to be extremely watchful, but we also need to develop the capabilities … to anticipate scenarios that could turn out to be ugly, and require that countries, including especially systemically significant countries take actions early to prevent another crisis.”

Justin Yifu Lin, Chinese national and chief economist at the World Bank, has told students that if China were to revalue its currency at its true worth, exports would become more expensive and raise prices for US consumers. Lin warns that this could depress consumer spending and slow US recovery.

Lin’s position stands in opposition to economists at the International Monetary Fund, which have proposed that a revaluation of China’s currency would help shrink its massive reserves and restore balance in the global economy. China has reserves of more than US$ 2 trillion, in comparison to a US deficit projected to reach $20 trillion by 2015.

China has also been criticised by Singapore and some European countries for its currency position. Singaporean finance minister Tharman Shamnugaratnam believes it is in China’s best interest to let their currency rise. He said allowing the yuan to gradually appreciate would help tamp down worldwide inflation, which was of “increasing concern” in China. He believed that an appreciating currency would help lift living standards in China and increase productivity ‘that goes with a  stronger exchange rate”.

US President Barack Obama has repeatedly urged China to adopt a “more market-oriented exchange rate”, however has demonstrated unwillingness to take action on China; in the interests of improving US-China relations, opting to delay a report into Chinese currency manipulation, originally slated for release on April 15.

China has stridently defended their fiscal policy, with deputy governor Su Ning, of the Chinese central bank, responding: “We always refuse to politicise the yuan exchange rate issue and we never think that one country should ask another for help in solving its own problems.”

As chief economist at the World Bank, Lin has significant influence. This latest statement provides weight to China’s claims that a revalued Chinese currency would hinder world recovery, rather than fuel it. This is based on the reality that over the past decades, the yuan devaluation has given Western countries access to cheap consumer goods, which raises living standards and boosts domestic consumption.

Following the IMF’s role in the recent global financial crisis, Strauss-Kahn says it’s only natural for the organisation to transform “into an institution even better equipped to meet the challenges of the post-crisis era”.

“What we seek is a new focus and capacity to deal with systemic risks,” he said, proposing a new multilateral surveillance procedure, which would allow the IMF to “assess the broader and systemic effects of country-level policies, and the associated risks, in a fundamentally different way”.

This would allow them to see links between economies, including those that would “transmit through the arteries of the global financial system” and spot problems earlier.

The Maldives has suffered from a fall in tourism, lower fish exports and a drop in capital inflows. The package “aims to rebuild international reserves to prudent levels,” said IMF deputy managing director Takatoshi Kato.

The Maldives will undergo a 36-month program to reduce fiscal deficit and maintain existing social programs. It will also reduce the size of its government, cut public sector salaries, introduce corporate taxes and privatise loss-making enterprises while protecting the poor through targeted subsidies.

The 2004 Indian Ocean tsunami, which took a number of the nation’s low-lying resorts, triggered an economic collapse that has seen its debt rise from 55.2 percent in 2004 to 91.6 percent of gross domestic product.

“This decision shows Australia’s strong reputation in finance and trade finance in particular and will give us a stronger voice in a range of multilateral fora,” said Minister for Trade Simon Crean.

“The presidency of the Berne Union is an opportunity for Australia to continue to play a significant influencing role in shaping infrastructure around trade finance issues as well as shaping the agenda to promote free trade, influence the continuation of open and transparent trading rules and develop a sustainable response toward recovery from the global financial crisis.”

Members of the Berne Union finance about 10 percent of the world’s trade, and collaborate on financing issues such as risk and trade management strategies. It also has close ties with the International Monetary Fund, the World Bank, the Organisation for Economic Co-operation and Development and the International Finance Corporation.

While the slowing unemployment rate has been providing some relief, consumers have not shown great confidence in the economy.

“Consumer spending will probably continue to grow, but at a more subdued pace. After the 3.4 percent real spending growth in the third quarter, we expect consumption growth of one percent or less in the fourth quarter,” said Nigel Gault, chief US economist of IHS Global Insight.

Consumer activity accounts for approximately two-thirds of US economic activity, thus forms a vital part of their recovery. International Monetary Fund managing director Dominique Strauss-Kahn recently encouraged the US to retain government stimulus until employment became stable.

“There are some encouraging figures, a few months ago from European countries and yesterday from the US and that’s all good news,” he said. “Nevertheless it does not mean the crisis is over. The crisis will not be over until unemployment begins to decrease and that will take many months.”

Strauss-Kahn said government support was important to avoid a ‘double-dip’ recession, which could occur if withdrawn prematurely. He predicted it would take 10-12 months for employment to stabilise and urged governments to continue with their policies until then.

“In the 10-12 coming months, unemployment will continue to rise,” he said. “That’s why we have to go on with the monetary and fiscal policies, the stimulus, until unemployment decreases. At that time we can declare victory.”

Governments in the region have successfully stimulated their respective economies and global trade has lifted, giving Asia an economic boost. China’s economy grew 8.9 percent in the September quarter and South Korea has also recorded significant acceleration.

However, the IMF urged Asian governments to continue with supportive policies throughout 2010, as the recent boost to production seems temporary. “Much of Asia’s rebound has been driven by temporary factors – a V-shaped bounce back in trade, and policy stimulus – whose importance is bound to wane over time,” according to the IMF’s Regional Economic Outlook for the Asia and the Pacific.

It cited Japan’s premature withdrawal of stimulus measures in the past as a warning: “On two occasions in Japan over the 1990s and early 2000s ‘green shoots’ of recovery emerged, allowing stimulus to be withdrawn.

“In both cases, however, the underlying corporate and financial problems had not been resolved, and the external environment deteriorated dramatically – first during the Asian financial crisis in 1997 and then the information technology bubble collapse in 2000. As a result, a more severe downturn ensued, necessitating renewed stimulus to support activity.”

The IMF singled out Australia, China and India as economies in the region performing better than expected.