GENEVA — Despite massive stimulus packages being injected into economies around the world, the global economy is projected to contract for the first time in 60 years in 2009 by 0.5 to 1 percent, an International Monetary Fund report said Thursday.
The IMF said major advanced economies will post sharper declines in output of 3 to 3.5 percent and emerging economies will grow by 1.5 to 2.5 percent, while the U.S. is now forecast to contract by 2.6 percent and European Union countries by 3.2 percent.
The revised global projections reflect a marked revision from late January, when the agency expected the global economy overall to expand by 0.5 percent.
“Turning around global growth will depend critically on more concerted policy actions to stabilize financial conditions, as well as sustained strong policy support to bolster demand,” the report said.
Giving an even more dire prediction, Heiner Flassbeck, head of a task force of economists at the United Nations Conference on Trade & Development, said during the release of a report on the global economic crisis that world output could contract by between 1 and 2 percent.
Flassbeck attributed the continued sharp contraction since late last year to the subprime credit crisis having set off a burst of speculation bubbles in the stock, commodity and currency markets.
Supachai Panitchpakdi, UNCTAD secretary general, said the G-20 leaders who meet in London on April 2 need to act fast to increase demand and help rehabilitate global trade and prevent it from dropping off rapidly.
Meanwhile, trade finance experts from major commercial banks and international financial institutions meeting in Geneva under the auspices of the World Trade Organization put the shortfall in trade finance at around $100 billion, up from a $25 billion shortfall in November, sources said.
The same sources said the World Bank and its International Finance Corp. are looking at offering $10 billion to $11 billion in funding during the G-20 summit to boost trade finance liquidity. With governments in rich and emerging nations under heavy pressure to bail out troubled companies, trade experts from the World Bank and the Organization for Economic Cooperation urged countries not to resort to protectionist policies.
A World Bank trade note said that since Nov. 17, G-20 nations have implemented 47 measures to restrict trade, including some in textiles. Argentina imposed nonautomatic licensing requirements on a host of goods, including textiles, shoes and leather goods, while Indonesia ushered in requirements that five categories of goods, including apparel, would be permitted in only five ports and airports.
Moreover, China and India had increased the rebate on the duty drawback system for exporters, it noted.
In his new book “Hollywood Royale,” Andy Warhol’s Protégé Matthew Rolston celebrates the Eighties revival of Hollywood glamour. Featuring more than 100 portraits taken by Rolston from 1977 to 1993, the book contains photos of icons like Michael Jackson, Cyndi Lauper, and @drewbarrymore, pictured here in 1991. “Hollywood Royale,” out today, will be accompanied by an exhibition opening at Los Angeles’ Fahey/Klein Gallery on March 1. #wwdeye
"Nowadays when life is not so happy with everything going on in the world, I think people come to me for a little bit of whimsy and color and fun." - Designer Rebecca De Ravenel on her cult-favorite jewelry line. (📸 : @vsteves) #wwd40
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“It’s passion that helps get anybody to a certain point and it’s what’s propelled me,” said Kith founder @ronniefieg, one of WWD’s 40 under 40: a group of industry notables who are changing the face of retail, fashion and beauty. Fieg, who opened a Manhattan flagship on October 7, began his career at age 13 as a stock boy and salesman for footwear chain David Z. “I think staying true to [my] beliefs, hard work and passion have gotten me to where [Kith] is today.” See the rest of the 40 at WWD.com. (📷: @vsteves) #wwd40
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BFF's Poppy Jamie and Suki Waterhouse celebrated the launch of their bag line Pop x Suki at Nordstrom last night. "The line is really about our friendship, and how we are so different but complement each other," said Waterhouse. 👯 (📷: Katie Jones) #wwdeye
After designing the new @louisvuitton and @bulgariofficial flagships and a @chanelofficial boutique opening in Japan, @petermarinoarchitect has another project on his plate: The Lobster Club. Located in the Seagram Building, it’s the famed architect’s first restaurant project in New York, serving up modern Japanese brasserie-style cuisine. Bronze hues, bespoke material detailing, blush and chartreuse tones and a heavy emphasis on Picasso can be seen throughout. Mark your calendars for Nov. 1 for the much-anticipated opening. (📷: @clint_spaulding) #wwdeye
Did you know: @carlychaikin of "Mr. Robot" has been painting for about a decade? The actress, who plays Darlene on the show, is a self-taught artist who lists Salvador Dalí and Chuck Close as some of her idols. Chaikin told WWD that painting is a form of meditation for her — A much-needed one given the intensity of "Mr. Robot." See a piece Chaikin is working on at WWD.com (📷: @jilliansollazzo) #wwdeye