Worst economic crisis in 2 decades

The latest OECD report reveals a depressing economic scenario for the immediate future.

The latest OECD report blames the September 11th attacks as being the main cause of the current world economic crisis. For the first time since 1982, the second half of the year (July to December 2001) will show a negative growth factor of 0.3% of GDP in OECD countries.

The US economy is the worst hit, according to the report. The impact of September 11th is translated into 50 billion USD. This cost is mainly borne by insurance companies, while the sectors most affected are understandably airline companies and tourism operators. The attacks also caused 15 billion USD of damage, apart from the priceless human casualties.

Consumer confidence was the greatest victim of the attacks, the report claiming that demand for equipment and goods, coupled with a stoppage in investments and a downturn in exports, compounded the current trend in the USA today. However, on a more optimistic note, the report predicts a 0.7% upturn in the US economy for the first half of 2002, rising to 2.9% in the second half.

Regarding the European Union, Euroland is the least affected area. The Gross Internal product among the 12 Euroland members is expected to rise by 1.6% in 2001, while in 2002, the growth rate is estimated at 1.4%. In 2003, the report predicts a rise of 3%. It is also pointed out that there are great differences in the behaviour of the economies of, for example, Spain, Italy and France (above average) and Germany and Finland (below).

The report claims that those countries which invested more in information technologies will be the first ones to come through the crisis, placing Ireland and Finland in a good position for the medium term.

John ASHTEAD PRAVDA.Ru