IMF economic counselor Olivier Blanchard said Tuesday in Washington that the global economy will grow by 3.7 percent in 2014, up from last year’s 3 percent rise. He said the world’s advanced economies will grow by 2.2 percent this year, with emerging market and developing economies moving ahead by 5.1 percent.
Blanchard said economic constraints from government austerity programs in some Western countries are diminishing. He also said the world’s financial systems are “slowly healing” as uncertainty decreases.
“The basic reason behind the stronger recovery is that the brakes to the recovery are progressively being loosened. The drag from fiscal consolidation is diminishing, the financial system is slowly healing, and uncertainty in various dimensions, is decreasing.”
Still, Blanchard said global recovery is “weak and uneven.” He said economic improvement is stronger in the United States than in Europe. He said the core northern countries in the 18-nation euro currency bloc and Great Britain are advancing faster than in southern Europe, which he described as a “worrisome part of the world economy.”
The IMF predicted 2.8 percent growth in the U.S. this year, although many economists think the figure will top 3 percent. Blanchard said the rate of Japan’s economic growth will be 1.7 percent for the second year in a row.