The world economy is not growing fast enough to generate jobs for millions who have become unemployed due to the financial crisis but it is gaining strength gradually, a top IMF official said.
While global growth is seen at 3.3 per cent this year and four per cent next year, this masks a significant divergence in prospects, said Naoyuki Shinohara, deputy managing director of the International Monetary Fund.
The world is seeing a “three-speed” global recovery without “enough growth to generate jobs for the millions who have fallen into unemployment over the past five years”, Shinohara told a gathering of diplomats and business people.
Creating jobs must be “an overarching issue” as it goes to the heart of the global economic crisis that is “falling disproportionately on young people”, he said in a speech in New Delhi.
The IMF official’s address came amid May Day protests in Europe against punishing government austerity drives and followed official figures Tuesday showing European unemployment hit a record of over 19 million.
Shinohara said the best performing economies were in the emerging and developing countries, with Asia expected to grow by an average 7.1 per cent this year and sub-Saharan Africa forecast to expand by 5.6 per cent.
Other nations are on the mend such as the United States, seen expanding by two per cent this year, but he said recovery in the euro zone “remains elusive” with growth expected to contract by a quarter of a percentage point.