Chinese banker: World economy to be volatile in 2010
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The global economic growth is expected to gain speed in the first half of this year and slowdown in the latter half as the recovery is still fragile, deputy governor of China's central bank said on Sunday.
Although the Chinese and U.S. economy grew significantly in the first quarter, that was "weak rebound" on the back of resuming confidence, not the demand and output in the real economy, Zhu Min, deputy governor of the People's Bank of China, who is also a special advisor to IMF Managing Director Dominique Strauss- Kahn.
"After adjusting for inflation and foreign exchange rate, the world economic output, at best, is forecast to be the equivalent of the level of 2007," he told an economic forum in Beijing.
He said problems arising from the global financial crisis still remained unsolved, such as the potential asset bubbles and debt crisis in some countries, including developed countries.
The world economic recovery is also confounded by rising trade frictions and the fact that the U.S. dollar, as the world's only reserve currency, is more and more used for profit speculation which signals investor's weak confidence in it.
He said the structural imbalance, including the imbalanced trade pattern, should be blamed for causing the global financial crisis, while the rebalance efforts take a long way.
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