Prospects for global economy like a “glass half-full”

PanARMENIAN.Net - Participants at the opening sessions of the World Economic Forum in Davos expressed confidence that the global economy is set fair.

The global economy dominates the first day of debates at the Swiss ski resort and, following unexpectedly strong global growth in 2010, the levels of optimism were better than at any Davos gathering since 2007.

Professor Nouriel Roubini of Roubini Global Economics, also known as “Dr Doom”, declared the prospects for the global economy as like a “glass half-full”. He said upside and downside risks were balanced.

His moderate optimism was shared by the rest of the panel including Zhu Min, a special adviser to the International Monetary Fund, who said the global economy would move from a “two-speed” pattern in 2010 to a “three-speed” arrangement this year.

“Emerging economies would still be well in the lead in the growth stakes, but the U.S. was likely to do significantly better than other advanced economies,” Mr Zhu said, because the U.S. would benefit from continued stimulus while other advanced economies were moving into austerity mode.

He said the likely resurgence of the U.S. consumer was not entirely positive for the global economy, however, because it threatened to allow emerging economies to remain wedded to export-led growth rather than seeking to rebalance their economies towards domestic consumption.

“Whether emerging markets can keep going towards domestic [orientation of their economies] is the key test for 2011,” he said, Financial Times reported.