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The April 2012 issue assesses the prospects for the global economy, which has gradually strengthened after a major setback during 2011. The threat of a sharp global slowdown eased with improved activity in the United States and better policies in the euro area. Weak recovery will likely resume in the major advanced economies, and activity will remain relatively solid in most emerging and developing economies.
This Report assesses changes in risks to financial stability over the past six months, focusing on sovereign vulnerabilities, risks stemming from private sector deleveraging, and assessing the continued resilience of emerging markets. More in this series
Overall, fiscal risks remain elevated. A number of conclusions emerge in regard to countries' ongoing vulnerability to unexpected shocks, the potential for substantial negative impacts of fiscal adjustment on activity, possible overstatements of short-term pressures on the public finances in some countries as general government gross debt ratios have risen, the implications of countries having flexibility in the short term but not the longer term, and the monitoring and enforcement challenges raised by second-generation fiscal rules.
This book describes the key elements, including tighter regulation and more effective supervision; greater transparency to strengthen market discipline and limit incentives for risk taking; coherent mechanisms for resolution of failed institutions; and effective safety nets to limit the impact on the financial system of institutions viewed as "too big to fail."
Sub-Saharan Africa continues to record strong economic growth, despite the weaker global economic environment. Regional output rose by 5 percent in 2011, with growth set to increase slightly in 2012, helped by still-strong commodity prices, new resource exploitation, and the improved domestic conditions that have underpinned several years of solid trend growth in the region's low-income countries.
Growth in much of Latin America remains solid, although it slowed during the second half of 2011 as a result of the combined effects of policy tightening and global uncertainties.
In 2011, the International Monetary Fund invited prominent economists and economic policy makers to consider the brave new world of the post-crisis global economy. The result is a book that captures the state of macroeconomic thinking at a transformational moment.
Barring the realization of downside risks to the global economy, growth in the Asia and Pacific region is expected to gain momentum of the course of 2012, according to this report, and now projected at 6 percent in 2012, rising to about 6 1/2 percent in 2013.
Welcome to the IMF's eLibrary—find in-depth, independent analysis on the financial crisis, development, macroeconomics, poverty reduction, trade, globalization, and much more.