The latest data indicate that the recovery in the European Union will be better than expected according to Anne Krueger, International Monetary Fund, First Deputy Managing Director.
Addressing the Asia Society Conference in New York, Ms. Krueger said the US continues to pull the recovery with some unexpected expansion in the third quarter, but in spite of "these encouraging signs" recovery "continues weak".
The IMF number two also cautioned about the world dependence on the US recovery since this makes many countries "highly vulnerable", and puts them in an uncomfortable situation if the leading world economy "stumbles".
Japan is undergoing a "modest recovery" attempt, but still has far to go.
However overall Ms. Krueger said the IMF expects expansion of the world economy in 2003 will be greater than expected, 3,5% and anticipates 4% for next year.
The benefits of this expansion will not necessarily reach the emerging economies although Latinamerica given the strong devaluation of most currencies has helped boost exports and GDP.
Further on Ms. Krueger regretted the failure of the recent WTO ministerial meeting in Mexico and recalled that "multilateral trade liberalization offers good prospects for the improvement of growth expectations in the medium and long term, both for industrialized and developing countries".
"It's essential the immediate resumption of the Doha round talks", she insisted.
Finally Ms. Krueger said that a homogeneous global recovery needs of "labour and production reforms in Europe; financial and business restructuring in Japan and an ample list of reforms to improve the level and resistance to growth from the emerging economies".