The world economy is likely to shrink to “below zero” this year, in what many are now referring to as the “Great Recession,” the head of the International Monetary Fund said on Tuesday.

“The IMF expects global growth to slow below zero this year, the worst performance in most of our lifetimes,” IMF Managing Director Dominique Strauss-Kahn told African political and financial leaders in the Tanzanian capital.

“Continued de-leveraging by world financial institutions, combined with a collapse in consumer and business confidence is depressing domestic demand across the globe, while world trade is falling at an alarming rate and commodity prices have tumbled” Strauss-Kahn added.

As advanced countries focus on problems in their own economies, Strauss-Kahn called on the international community not to forget Africa, where regional growth is expected to slow sharply to 3 percent this year, half the rate of the past five years.

Strauss-Kahn warned the projection for 3 percent “may be too optimistic.”

“Even though the crisis has been slow in reaching Africa’s shores, we all know it is coming and its impact will be severe,” he said. “We must ensure that the voices of the poor are heard. We must ensure that Africa is not left out,” he added.

Source: Reuters

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