The managing director of the International Monetary Fund (IMF), Dominique Strauss-Kahn, said that the world is immersed in a crisis of ‘extreme gravity’ and that it will not recover until the financial systems have been ‘cleaned.’ “To be frank, the situation is extremely serious,” he admitted at a meeting in Geneva organized by the International Labor Organization (ILO).
Strauss-Kahn warned that the current crisis can drag into poverty and unemployment of millions of people worldwide, bringing the risk of social unrest and even war. Hence, there is a demand for urgent action to combat the current crisis.
“This dramatically affects employment, and even beyond. For many countries, this could represent the root of social unrest and threats to democracy. In some, it could lead to war,” Strauss-Kahn warned.
The IMF believes, however, that there exists the possibility of achieving a recovery by 2010 if decisions are urgent and coordinated internationally.
Moreover, world trade in 2009 will fall by 9 percent due to the crisis. This shall be the biggest decline since World War II, according to a report released by the World Trade Organization (WTO).
”The contraction in developed countries will be particularly severe, and a fall in exports of 10 percent,” the report said. For developing countries, the decline will be from 2 to 3 percent.
Via Reuters/kippreport
