World growth to slow before recovery: IMF

NEW YORK, September 9, 2008 (AFP) – World economic growth is set to continue to slow in the second half of 2008 before a gradual recovery in 2009, the number two official at the International Monetary Fund, John Lipsky, said Tuesday.

“The global economy is projected to slow further in the second half of 2008, with a recovery gaining pace gradually in 2009,” Lipsky said in speech to be delivered in Frankfurt, Germany, according to a copy pre-released here.

The IMF predicts that global growth will crawl to three percent in late 2008 from five percent in 2007 and could climb back “toward four percent in the course of 2009.”

“The specific figures are still under review and will be released in our World Economic Outlook next month,” he said.

A source close to a G20 delegation indicated at the end of August that the IMF had dropped its latest world growth projections for 2008 to 3.9 percent from 4.1 percent and 3.7 percent from 3.9 percent for 2009.

“The recovery of global economic activity in 2009 would be driven by the unwinding of the effects of the more than 50 percent increase in oil prices in 2008 and the bottoming out of the US housing sector,” Lipsky said.

In the United States, growth is set to fall to