By Maximilian Clarke
‘Bold decisions’ are needed from leaders of the world's 20 strongest economies as they convene this week in Cannes to decide plans for a global recovery, the Secretary-General of the Organisation for Economic Cooperation and Development has today said.
The continued Eurozone debt crisis and fiscal policy decisions in the United States will, predicted Angel Gurria, continue to dominate economic developments for the next few years.
In a move that will be welcomed by opponents of David Cameron’s deficit reduction programme, Gurria suggested short term boosts in economic activity should be pursued ahead of longer-term deficit reduction programmes. Fiscal stimulus is needed to tackle high unemployment across the economically developed world, restoring demand and providing a much needed boost for business.
Meanwhile emerging markets’ growth has seen some softening, though will remain important drivers for growth for the beleaguered West. Gurria added that prospects would be considerably worse were it not for the progress made during the past EU Summit, which saw a lifting of stock markets across the globe.
In the mean time, Gurria recommended all G20 member states maintain low interest rates, and to prepare budgets to better accommodate losses in productivity.
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