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Global economy requires 'rebalancing': IMF

Global economy requires 'rebalancing': IMF article image
Rebalancing the economies of Asia and the USA will be the key to global recovery, according to the chief economist of the International Monetary Fund (IMF). In an IMF article published in the forthcoming edition of the World Economic Outlook, Olivier Blanchard acknowledged that the current downturn was no ordinary recession and therefore "the turnaround will not be simple". Blanchard suggested that two acts will need to occur to sustain a global recovery, primarily a switch from public to private spending, then the rebalancing of international trade flows. Rebalancing would require "a shift from domestic to foreign demand in the United States and a reverse shift from foreign to domestic demand in the rest of the world, particularly in Asia," he said.

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