According to the International Monetary Fund, the Eurozone countries are forecast to register a slower growth rate than expected, while the US economy is set to see a faster recovery than had at first been predicted in the year 2002.
The 12 members of the Eurozone (the 15 European Union Member States minus the UK, Denmark and Sweden) are expected to grow 1.3% in 2002 and not 1.4%, which had been forecast previously, although the IMF states that the Eurozone economy is “moving ahead” and “is not a motive for preoccupation”, a situation which should allow the European Central bank to keep interest rates low.
The forecast Gross Domestic Product for the Eurozone is set at 2.9% for 2003. In the United States, the GDP growth rate is forecast to be between 2.5% and 2.7%, well over the 2.3% forecast in May. For 2003, the growth rate is 3.5% against the 3.4% originally predicted.
The IMF report indicates that the US budget policy is crucial to the growth rate, pointing out that the USA went from a budget surplus of 1.5% of GDP in 2000 to a budget deficit of 1.4% in 2002.
As for the world economy, a growth rate of 2.9% is forecast for 2002, against 2.8% forecast in May, and for 2003, the rate is forecast at 4.1% against 4%, helped by a slight decrease in petroleum prices.
John ASHTEAD PRAVDA.Ru LONDON UNITED KINGDOM